Horizontal coordination and free-riding in a group of certified organic crop growers: An empirical study of the Ezemvelo Farmers’ Organization in KwaZulu-Natal, South Africa

This study investigated the prevalence and determinants of free-riding in the Ezemvelo Farmers’ Organization (EFO), a group of certified organic crop growers in South Africa, using data gathered in a census survey of its 151 partially and fully certified members. The computed free-riding index scores suggested that free-riding posed a serious threat to the group’s collective marketing efforts. Regression analysis showed that members who were male, poorly educated, aware of loopholes in the grading system, and who did not trust the buyer, were more likely to free-ride. In the longer term, the EFO should address institutionalized free-riding by issuing tradable ownership rights. In the short term, it must engage with the packhouse (buyer) to remove flaws in the grading process that conceal the origin of low quality produce. Transparent and mediated negotiations leading to an incentive compliant contract with the buyer may also help to build trust and reduce free-riding within the EFO.

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African Journal of Agricultural and Resource Economics, 01, 2
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 Record created 2017-04-01, last modified 2020-10-28

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