Food Credence Attributes: A Conceptual Framework of Supply Chain Stakeholders, Their Motives, and Mechanisms to Address Information Asymmetry

Abstract

Food credence attributes (e.g., food safety, organic, and carbon neutral production methods) are quality characteristics of products that cannot be assessed by buyers at the point of sale without additional information (e.g., certification labels). Hence, the ability to access credence attributes of a particular product can result in a situation termed as asymmetric distributed information among supply chain stakeholders (e.g., producers, processors, wholesalers, retailers, consumer) where one party of a market transaction is in possession of more information about a product than the other party. This situation can lead to potential inefficiencies, e.g., misinformation, risk of food borne illness, or opportunistic behavior such as fraud. The present study sought to develop a conceptual framework that describes a) the motivation for key stakeholders to participate in the market for food credence attributes, b) the type of food credence attributes that key stakeholders provide, and c) current mechanisms to address the issue of information asymmetry among the stakeholders in the food system. The study was conducted using an integrative literature review. The developed framework consists of two components: a) the food supply chain and b) the attribute assurance system among which multiple links exist. The findings suggest that retailers, processors, NGOs, and government authorities are influential stakeholders within the supply chain of food credence attributes by imposing food quality standards which can address information asymmetry among food actors. While the credence attribute assurance system (e.g., food standards, third party food attribute assurance providers) can potentially address the issue of asymmetric information among market stakeholders, a range of issues remain. These include food standards as a potential market entry barrier for food producers and distributors, limited food standard harmonization, and communication challenges of food attribute assurance (e.g., consumers’ signal processing, signal use and trust). The syntheses presented in this study contributes to stakeholders’ (e.g., supply chain actors, scientists, policy makers) improved understanding about the components of the credence food system and their integration as well as the drivers for change in this system.

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“…Their primary role is to signal product attributes that cannot be assessed properly by consumers at the point of sale or when consumed but can have a positive impact on product choice and the price consumers are willing to pay if signaled. In the theory of information economics, such attributes are categorized as credence attributes (Schrobback et al, 2023;Holland, 2016). Sustainability credence attributes include, among others, the environmental sustainability of production processes, such as eco-friendliness, carbon neutrality, and organic (Schrobback et al, 2023).…”

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“…In this study, we followed a conceptual framework of interrelated categories explaining the sequence of information transference from the cattle farmer to the consumer. As Figure 1 shows, it considers mainly a vertical transference of information through the different stakeholders (Schrobback et al, 2023). However, the farmer may also share information directly with the consumer using alternative channels (e.g., direct sales).…”

“…The level of complexity of the distribution channel depends on the number of intermediaries. Moreover, a short supply chain may help to diminish the presence of information asymmetry (Schrobback et al, 2023;Cruz et al, 2021), which occurs when the cattle farmer or other actor in the value chain does not effectively share information with consumers about production processes or the beef attributes.…”

“…However, in the last decade, choice experiment applications (combining a purchasing context with a controlled experimental setting) have arisen (Hensher et al, 2015). Choice experiments involve the analysis of a smaller number of attributes Source: author's own elaboration based on Grunert (2005), Schrobback et al (2023).…”

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“…Os atributos de crença são características de qualidade (seja a segurança alimentar, produção orgânica, baixas emissões de carbono, cultivo com técnicas tradicionais etc.) que não podem ser acessadas no ponto venda sem os selos de qualidade -que, por sua vez, visam à redução da assimetria de informações entre o produtor e o consumidor [7] .…”