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What Impact Are EU Supermarket Standards Having on Developing Countries Export of High-Value Horticultural Products? Evidence from Kenya

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  • Asfaw, Solomon
  • Mithofer, Dagmar
  • Waibel, Hermann

Abstract

European Union (EU) retailers are setting global benchmarks for the production of fresh food, and are asking their suppliers for produce to be certified according to food safety and quality standards. Compliance to these standards for developing countries small-scale producers entail costly investment in variable inputs and long term structures. Limited empirical evidence exists either to refute or confirm the concern that the proliferation and enhanced stringency of these standards marginalize smallholders from global market. This article therefore explores the costs of compliance, factors explaining the smallholder decision to adopt EU private quality standard and the impacts of the standard on farm financial performance. We develop a two-stage standard treatment effect model to account for self-selection as a source of endogeneity. Analysis is based on a random cross section sample of 439 small-scale export vegetable producers in Kenya whose production was monitored in 2005/2006. We demonstrate that adopters and non-adopters are distinguishable by their asset holding and household wealth, access to services, labor endowment and level of education. Once we control for endogeneity problem, we found that small-scale producers can benefit substantially from adopting the standard at the farm level.

Suggested Citation

  • Asfaw, Solomon & Mithofer, Dagmar & Waibel, Hermann, 2007. "What Impact Are EU Supermarket Standards Having on Developing Countries Export of High-Value Horticultural Products? Evidence from Kenya," 105th Seminar, March 8-10, 2007, Bologna, Italy 7870, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaa105:7870
    DOI: 10.22004/ag.econ.7870
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    Cited by:

    1. M. Maertens & J. Swinnen, 2012. "Private Standards, the Organization of Global Supply Chains, and their Impact on Developing Countries," Chapters, in: Axel Marx & Miet Maertens & Johan Swinnen & Jan Wouters (ed.), Private Standards and Global Governance, chapter 6, Edward Elgar Publishing.
    2. Kareem, Olayinka Idowu, 2016. "Food safety regulations and fish trade: Evidence from European Union-Africa trade relations," Journal of Commodity Markets, Elsevier, vol. 2(1), pages 18-25.
    3. Subervie, Julie & Vagneron, Isabelle, 2012. "Can Fresh Produce Farmers Benefit from Global Gap Certification? The case of lychee producers in Madagascar," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126704, International Association of Agricultural Economists.
    4. Stefan Ouma, 2010. "Global Standards, Local Realities: Private Agrifood Governance and the Restructuring of the Kenyan Horticulture Industry," Economic Geography, Clark University, vol. 86(2), pages 197-222, April.
    5. Maertens, Miet & Verhofstadt, Ellen, 2013. "Horticultural exports, female wage employment and primary school enrolment: Theory and evidence from Senegal," Food Policy, Elsevier, vol. 43(C), pages 118-131.
    6. Chege, Jane Wambui & Rose Athiambo, Nyikal & Mburu, John & Muriithi, Beatrice Wambui, 2015. "Impact Of Export Horticulture Farming On Per Capita Calorie Intake Of Smallholder Farmers In Eastern And Central Provinces In Kenya," International Journal of Food and Agricultural Economics (IJFAEC), Alanya Alaaddin Keykubat University, Department of Economics and Finance, vol. 3(4), pages 1-17, October.
    7. Russo, Carlo & Perito, Maria Angela & Di Fonzo, Antonella, 2014. "Using Private Food Safety Standards to Manage Complexity: A Moral Hazard Perspective," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 15(2), pages 1-15.
    8. Schipmann, Christin & Qaim, Matin, 2009. "Modern Supply Chains and Product Innovation: How Can Smallholder Farmers Benefit?," 2009 Conference, August 16-22, 2009, Beijing, China 51046, International Association of Agricultural Economists.
    9. Maertens, Miet & Verhofstadt, Ellen, 2012. "Horticultural exports, female wage employment and primary school enrolment: Theory and evidence from a natural quasi-experiment in Senegal," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126856, International Association of Agricultural Economists.
    10. repec:lic:licosd:24509 is not listed on IDEAS
    11. Kersting, Sarah & Wollni, Meike, 2012. "New institutional arrangements and standard adoption: Evidence from small-scale fruit and vegetable farmers in Thailand," Food Policy, Elsevier, vol. 37(4), pages 452-462.
    12. Kariuki, Isaac Maina & Loy, Jens-Peter & Herzfeld, Thomas, 2012. "Farmgate Private Standards and Price Premium: Evidence From the GlobalGAP Scheme in Kenya's French Beans Marketing," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 28(1), pages 42-53.
    13. Fontaine, Damien & Gaspart, Frederic & Frahan, Bruno Henry de, 2008. "Modelling the impact of private quality standards on the fresh fruit and vegetable supply chains in developing countries," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 44378, European Association of Agricultural Economists.
    14. Kareem, Olayinka Idowu, 2022. "Fruit safety regulations in the transatlantic region: How are Africa’s exports faring with the regulations?," Journal of Policy Modeling, Elsevier, vol. 44(5), pages 886-902.
    15. Olayinka Idowu Kareem, 2016. "The High-Value Commodity Export Effects of Standards in Africa," The International Trade Journal, Taylor & Francis Journals, vol. 30(3), pages 237-259, May.
    16. Russo, Carlo & Perito, Maria Angel & Di Fonzo, Antonella, 2014. "The Strategic Use of Private Food Safety Standards to Manage Complexity: a Moral Hazard Perspective," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182795, European Association of Agricultural Economists.
    17. Shimon, Otieno Peter & Ogutu, Chris Ackello & Mburu, John & Nyikal, Rose Adhiambo, 2016. "Does Global-GAP policy reduce smallholder greenhouse gas emissions from French bean production in Central and Eastern regions of Kenya?," 2016 Fifth International Conference, September 23-26, 2016, Addis Ababa, Ethiopia 246437, African Association of Agricultural Economists (AAAE).
    18. Olayinka Idowu Kareem, 2014. "The European Union Sanitary and Phytosanitary Measures and Africa’s Exports," RSCAS Working Papers 2014/98, European University Institute.
    19. Kersting, Sarah & Wollni, Meike, 2011. "Public-private partnerships and GLOBALGAP standard adoption: evidence from small-scale fruit and vegetable farmers in Thailand," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114761, European Association of Agricultural Economists.

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