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Modern Food Retailers and Traditional Markets in Developing Countries: Comparing Quality, Prices, and Competition Strategies in Thailand

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  • Christin Schipmann
  • Matin Qaim

Abstract

Supermarkets and hypermarkets are expanding rapidly in many developing countries. While consequences for farmers and consumers were analyzed recently, little is known about the implications for traditional retail formats such as wet markets. Using data from a market survey in Thailand and hedonic regressions, we analyze quality and prices for fresh vegetables from different retail outlets. Compared to wet markets, modern retailers sell higher quality at higher prices, indicating that they are primarily targeting better-off consumers, and not directly competing for the same market segments. Yet there are signs that modern and traditional markets will gradually converge. Policy implications are discussed. Copyright 2011, Oxford University Press.

Suggested Citation

  • Christin Schipmann & Matin Qaim, 2011. "Modern Food Retailers and Traditional Markets in Developing Countries: Comparing Quality, Prices, and Competition Strategies in Thailand," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 33(3), pages 345-362.
    • Handle: RePEc:oup:apecpp:v:33:y:2011:i:3:p:345-362
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    Cited by:

    1. Kedar Vishnu & Parmod Kumar, 2019. "Structure and strategy of supermarkets of fruits and vegetables retailing in Karnataka: Gains for whom?," Working Papers 438, Institute for Social and Economic Change, Bangalore.
    2. Makaiko G. Khonje & Matin Qaim, 2019. "Modernization of African Food Retailing and (Un)healthy Food Consumption," Sustainability, MDPI, vol. 11(16), pages 1-18, August.
    3. Gómez, Miguel I. & Ricketts, Katie D., 2013. "Food value chain transformations in developing countries: Selected hypotheses on nutritional implications," Food Policy, Elsevier, vol. 42(C), pages 139-150.
    4. Altenburg, Tilman & Kulke, Elmar & Reeg, Caroline & Peterskovsky, Lisa & Hampel-Milagrosa, Aimée, 2016. "Making retail modernisation in developing countries inclusive: a development policy perspective," IDOS Discussion Papers 2/2016, German Institute of Development and Sustainability (IDOS).
    5. Yuan, Yuan & Si, Zhenzhong & Zhong, Taiyang & Huang, Xianjin & Crush, Jonathan, 2021. "Revisiting China’s supermarket revolution: Complementarity and co-evolution between traditional and modern food outlets," World Development, Elsevier, vol. 147(C).
    6. Ebata, Ayako & Hüttel, Silke, 2015. "Do development projects link smallholders to markets?," GlobalFood Discussion Papers 204326, Georg-August-Universitaet Goettingen, GlobalFood, Department of Agricultural Economics and Rural Development.
    7. Alemayehu Dekeba Bekele & Joost Beuving & Ruerd Ruben, 2017. "How African Households Shop: Evidence from Dairy Chains in Ethiopia," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 29(4), pages 806-826, August.
    8. Kulke, Elmar & Suwala, Lech, 2015. "Internationalization of grocery retailers in emerging markets – general considerations and economic impacts," EconStor Preprints 247642, ZBW - Leibniz Information Centre for Economics.
    9. repec:lic:licosd:42221 is not listed on IDEAS
    10. Theriault, Veronique & Assima, Amidou & Vroegindewey, Ryan & Tschirley, David & Keita, Naman, 2017. "A City-Retail Outlet Inventory Of Processed Dairy And Grain Foods: Evidence From Mali," Feed the Future Innovation Lab for Food Security Policy Research Papers 261675, Michigan State University, Department of Agricultural, Food, and Resource Economics, Feed the Future Innovation Lab for Food Security (FSP).
    11. Liu, Haiyan & Wahl, Thomas I. & Seale, James L. & Bai, Junfei, 2015. "Household composition, income, and food-away-from-home expenditure in urban China," Food Policy, Elsevier, vol. 51(C), pages 97-103.
    12. Rosina Wanyama & Theda Gödecke & Christine G. K. Chege & Matin Qaim, 2019. "How important are supermarkets for the diets of the urban poor in Africa?," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 11(6), pages 1339-1353, December.
    13. Rischke, Ramona & Kimenju, Simon C. & Klasen, Stephan & Qaim, Matin, 2015. "Supermarkets and food consumption patterns: The case of small towns in Kenya," Food Policy, Elsevier, vol. 52(C), pages 9-21.
    14. Ebata, Ayako & Huttel, Silke, 2015. "Do development projects link smallholdrs to markets?," 2015 Conference, August 9-14, 2015, Milan, Italy 211583, International Association of Agricultural Economists.
    15. Sara Ratna Qanti & Thomas Reardon & Arief Iswariyadi, 2017. "Triangle of Linkages among Modernising Markets, Sprayer–traders, and Mango-farming Intensification in Indonesia," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 53(2), pages 187-208, May.
    16. Pagare, Dewang & Biswas, Indranil & Agrahari, Amit & Ghosh, Sriparna, 2023. "A small farmer’s market choice in the presence of multiple markets: The Indian case," European Journal of Operational Research, Elsevier, vol. 311(2), pages 739-753.
    17. Nuthalapati, Chandra S.R. & Sutradhar, Rajib & Reardon, Thomas & Qaim, Matin, 2020. "Supermarket procurement and farmgate prices in India," World Development, Elsevier, vol. 134(C).
    18. Ihli, Hanna & Seegers, Ronja & Winter, Etti & Chiputwa, Brian & Gassner, Anja, 2021. "Preferences for Tree-Fruit Market Attributes Among Smallholder Farmers in Eastern Rwanda: A Discrete Choice Experiment," 2021 Conference, August 17-31, 2021, Virtual 314980, International Association of Agricultural Economists.
    19. César Salazar & Andrés Acuña‐Duarte & José Maria Gil, 2023. "Drought shocks and price adjustments in local food markets in Chile: Do product quality and marketing channel matter?," Agricultural Economics, International Association of Agricultural Economists, vol. 54(3), pages 349-363, May.

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