Value Chain Innovations for Technology Transfer in Developing and Emerging Economies: Concept, Typology and Policy Implications

Abstract

The adoption of modern technologies in agriculture is crucial for improving productivity of poor farmers and poverty reduction. However, the adoption of modern technology has been disappointing. The role of value chains in technology adoption has been largely ignored so far, despite the dramatic transformation and spread of modern agri-food value chains. We argue that value chain organization and innovations can have an important impact on modern technology adoption, not just by downstream companies, but also by farmers. We provide a conceptual framework and an empirical typology of institutional innovations through which value chains can contribute to technology transfer to agriculture in developing and emerging countries.

Contracting Institutions, Agro‐food Trade and Product Quality

“…As a result, in recent decades the rules which govern relationships along the agro‐food chain have changed quite substantially (Reardon and Timmer, ; Swinnen, ; Maertens and Swinnen, ; Curzi et al ., ). Clearly, this has consistently reshaped the institutional environment within which the agro‐food chain transactions take place (Reardon and Timmer, ; Swinnen and Kuijpers, ). Our findings provide indirect evidence that this might have had important consequences for what food is being produced and how.…”

“…More specifically, by means of incomplete contract theory, these studies seek to explain the internalisation decisions of multinational enterprises and investigate why some firms source inputs mainly via foreign direct investments whereas other firms source them primarily via outsourcing. However, none of these papers is concerned with the impact of contracting institutions on the quality of exported products and quality upgrading, a key issue of the current transformation of agro‐food value chains (Reardon et al ., ; Reardon and Timmer, ; Swinnen and Kuijpers, ). Finally, the findings of this paper are also related to recent contributions linking institutions, trade and product quality.…”

Economics and politics of food standards, trade, and development#

“…Empirical studies show that the requirements for farmers to satisfy standards and to invest in modern technology in HS value chains (as well as the need to economize on transaction costs) has resulted in a remarkable heterogeneity in value chain governance, including a significant amount of vertically integrated production systems, but also various forms of smallholder contracting (see e.g., Beghin et al, 2015;Swinnen, 2009, 2014;Reardon et al, 2009). 22 The designs of the contracts often vary considerably, going from (short run) provision of seeds and technical advice to complex (longer run) schemes that provide interlinked bank loan guarantees and investment loans for significant on-farm investments (such as cooling equipment in dairy) involving processors, financial institutions and technology companies (e.g., Dries et al, 2009;Swinnen and Kuijpers, 2016). Others show how greenhouses and irrigation infrastructure investments have resulted from vertically integrated value chains (e.g., Maertens et al, 2011).…”