TY - JOUR

T1 - Investment in compliance with GlobalGAP standards

T2 - Does it pay off for small-scale producers in Kenya?

AU - Asfaw, Solomon

AU - Mithöfer, Dagmar

AU - Waibel, Hermann

PY - 2009

Y1 - 2009

N2 - Limited empirical evidence exists either to refute or confirm the concern that the proliferation and enhanced stringency of private food-safety standards marginalize smallholders from global markets and thus drive them deeper into poverty. In this paper, factors are identified that can explain the decision of small-scale producers to adopt private standards. It is also analysed whether investments in standards compliance pays off for small-scale producers. Using household-level survey data from Kenya, it can be shown that adopters and non-adopters are distinguishable by their wealth status, access to services and level of education. Econometric analysis shows that adoption of standards significantly improves smallholder farm financial performance. The financial rate of return on investments in standards compliance at farm level is high even under conservative assumptions. The major message of the paper is that smallholder farmers who have the ability to invest in required structures benefit substantially from adopting private standards.

AB - Limited empirical evidence exists either to refute or confirm the concern that the proliferation and enhanced stringency of private food-safety standards marginalize smallholders from global markets and thus drive them deeper into poverty. In this paper, factors are identified that can explain the decision of small-scale producers to adopt private standards. It is also analysed whether investments in standards compliance pays off for small-scale producers. Using household-level survey data from Kenya, it can be shown that adopters and non-adopters are distinguishable by their wealth status, access to services and level of education. Econometric analysis shows that adoption of standards significantly improves smallholder farm financial performance. The financial rate of return on investments in standards compliance at farm level is high even under conservative assumptions. The major message of the paper is that smallholder farmers who have the ability to invest in required structures benefit substantially from adopting private standards.

KW - Adoption

KW - Export producers

KW - GlobalGAP standards

KW - Impact

KW - Kenya

UR - http://www.scopus.com/inward/record.url?scp=73449135793&partnerID=8YFLogxK

M3 - Article

AN - SCOPUS:73449135793

VL - 48

SP - 337

EP - 362

JO - Quarterly Journal of International Agriculture

JF - Quarterly Journal of International Agriculture

SN - 0049-8599

IS - 4

ER -