Group contracts and sustainability: Experimental evidence from smallholder seed production
Contract farming in seed production has played an instrumental role in bringing private investment into seed research and production. As developing countries have predominantly small and marginal farmers, the number of inefficiencies that arise from seed contractual agreements hinders producers from...
| Main Authors: | , , |
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| Format: | Journal Article |
| Language: | Inglés |
| Published: |
Public Library of Science
2021
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| Online Access: | https://hdl.handle.net/10568/164212 |
| _version_ | 1855521732120543232 |
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| author | Veettil, Prakashan Chellattan Yashodha Johny, Judit |
| author_browse | Johny, Judit Veettil, Prakashan Chellattan Yashodha |
| author_facet | Veettil, Prakashan Chellattan Yashodha Johny, Judit |
| author_sort | Veettil, Prakashan Chellattan |
| collection | Repository of Agricultural Research Outputs (CGSpace) |
| description | Contract farming in seed production has played an instrumental role in bringing private investment into seed research and production. As developing countries have predominantly small and marginal farmers, the number of inefficiencies that arise from seed contractual agreements hinders producers from realizing the full potential benefits from seed contracts. We carried out an economic experiment with real producers and organizers currently engaged in seed production to analyze their preference for group seed contracts, its sustainability and welfare implications in the seed value chain. The producers are offered two types of group contracts: B and C. Contract B involves a company-organizer-seed producer group (SPG) whereas contract C removes the organizer and directly engages with the SPG (company → SPG). In the experiment, producers are asked to choose between an existing contract and either of the proposed group contracts. The experiment consists of two treatments: (i) concealed and revealed price information between agents, and (ii) presence and absence of a local organizer while making the decision. We find that the preference for group contract B is higher than for group contract C, suggesting the need for producers bargaining which can be achieved through group contract in the existing contract, Bargaining is high (6.3 percentage points) when price information is concealed. SPGs survive for about four out of five rounds and more than half of the groups (53%) formed in the first round survived throughout the five rounds, indicating a very high group sustainability. |
| format | Journal Article |
| id | CGSpace164212 |
| institution | CGIAR Consortium |
| language | Inglés |
| publishDate | 2021 |
| publishDateRange | 2021 |
| publishDateSort | 2021 |
| publisher | Public Library of Science |
| publisherStr | Public Library of Science |
| record_format | dspace |
| spelling | CGSpace1642122025-01-24T14:12:36Z Group contracts and sustainability: Experimental evidence from smallholder seed production Veettil, Prakashan Chellattan Yashodha Johny, Judit Contract farming in seed production has played an instrumental role in bringing private investment into seed research and production. As developing countries have predominantly small and marginal farmers, the number of inefficiencies that arise from seed contractual agreements hinders producers from realizing the full potential benefits from seed contracts. We carried out an economic experiment with real producers and organizers currently engaged in seed production to analyze their preference for group seed contracts, its sustainability and welfare implications in the seed value chain. The producers are offered two types of group contracts: B and C. Contract B involves a company-organizer-seed producer group (SPG) whereas contract C removes the organizer and directly engages with the SPG (company → SPG). In the experiment, producers are asked to choose between an existing contract and either of the proposed group contracts. The experiment consists of two treatments: (i) concealed and revealed price information between agents, and (ii) presence and absence of a local organizer while making the decision. We find that the preference for group contract B is higher than for group contract C, suggesting the need for producers bargaining which can be achieved through group contract in the existing contract, Bargaining is high (6.3 percentage points) when price information is concealed. SPGs survive for about four out of five rounds and more than half of the groups (53%) formed in the first round survived throughout the five rounds, indicating a very high group sustainability. 2021-08-18 2024-12-19T12:53:36Z 2024-12-19T12:53:36Z Journal Article https://hdl.handle.net/10568/164212 en Open Access Public Library of Science Veettil, Prakashan Chellattan; Yashodha and Johny, Judit. 2021. Group contracts and sustainability: Experimental evidence from smallholder seed production. PLoS ONE, Volume 16 no. 8 p. e0255176 |
| spellingShingle | Veettil, Prakashan Chellattan Yashodha Johny, Judit Group contracts and sustainability: Experimental evidence from smallholder seed production |
| title | Group contracts and sustainability: Experimental evidence from smallholder seed production |
| title_full | Group contracts and sustainability: Experimental evidence from smallholder seed production |
| title_fullStr | Group contracts and sustainability: Experimental evidence from smallholder seed production |
| title_full_unstemmed | Group contracts and sustainability: Experimental evidence from smallholder seed production |
| title_short | Group contracts and sustainability: Experimental evidence from smallholder seed production |
| title_sort | group contracts and sustainability experimental evidence from smallholder seed production |
| url | https://hdl.handle.net/10568/164212 |
| work_keys_str_mv | AT veettilprakashanchellattan groupcontractsandsustainabilityexperimentalevidencefromsmallholderseedproduction AT yashodha groupcontractsandsustainabilityexperimentalevidencefromsmallholderseedproduction AT johnyjudit groupcontractsandsustainabilityexperimentalevidencefromsmallholderseedproduction |