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Abstract
We estimate the effect of search frictions on Kenyan farmers' decisions to supply French
beans for export under contract. This paper has two main contributions. First, we build on the
competitive wage models of Moen (1997) and Mortensen and Wright (2002) to include imperfect
contract enforcement. Second, we employ two novel empirical methodologies to test our model using
data from Kenya's French bean export industry. The first methodology measures search frictions
based on the spatial density of firms and farmers in the market. The second uses preferences
measured in a choice experiment to quantify the impact of search frictions on farmers entry and
exit decisions under different contract enforcement scenarios. We find that search frictions are
present in the market which primarily limits farmers' abilities to match with potential buyers but
not vice versa. Examining the two component submarkets of the French bean export market, we
find that search frictions are a potential barrier to entry for the fresh submarket and may be a factor
in farmers' exit decision from the processed market. Lastly, we find search frictions are a potential
barrier in areas where buyers are perceived as more reliable, suggesting a potential trade-off for
policymakers depending on whether they design an intervention to target contract enforcement or
search frictions. These findings are important for designing more effective programs to connect
small-scale producers to French bean markets.