Advertisement

An Overlook of the Economic Benefits of Value-Based Food Chains to Maintain Farms Operating in Less Favoured Areas

A Review Paper
Chapter
  • 282 Downloads
Part of the Cooperative Management book series (COMA)

Abstract

The aims of this paper go towards collecting and demonstrating the positive economic influences/effects of value-based food chains (known as food chains with added values) on the social and economic situation of farms. Especially this type of food chain can be recognized as very important for preserving the sustainable development of small farms located on hilly and mountain regions as well as on other less favoured areas. The results are based on the analysis of value-based food chains from Slovenian mountain regions. Added values are manifested through several economic parameters while the most important is the highest purchase prices of agricultural raw material. From the case study, the elasticity values were calculated for purchase prices of raw milk as the indicator to recognize the potential economic benefits. The authors have chosen two different methodological approaches for this study. Both of them are based on the empirical mathematical approach (econometric analysis).

Keywords

Value-based food chains Purchase price of milk Econometric analysis Mountain farms 

References

  1. Antle, J. M. (1984). The structure of U.S. agricultural technology 1910–78. American Journal of Agricultural Economics, 66(4), 414–421.CrossRefGoogle Scholar
  2. Barjolle, D., Paus, M., & Perret, A. (2009). Impacts of geographical indications review of methods and empirical evidences. Paper presented at the IAAE conference, Beijing, China.Google Scholar
  3. Bernet, T., Staal, S., & Walker, T. (2001). Changing milk production trends in Peru. Small-scale highland farming versus coastal agribusiness. Mountain Research and Development, 21(3), 268–275.CrossRefGoogle Scholar
  4. Beyers, L., & Hassan, R. (2000). The structure of South African milk production technology: A parametric approach to supply analysis. Working paper 2000−04. University of Pretoria, Department of Agricultural Economics, South Africa.Google Scholar
  5. Bos, J. W. B., & Koetter, M. (2011). Handling losses in translog profit models. Applied Economics, 43(3), 307–312.CrossRefGoogle Scholar
  6. European Commission. (2014). Commission study explores use of “mountain product” label. Accessed April 25, 2016, from https://ec.europa.eu/agriculture/newsroom/104_en
  7. Henningsen, A. (2014). Introduction to econometric production analysis with R (draft version). Department of Food and Resource Economics, University of Copenhagen. Accessed October 9, 2014, from http://files.itslearning.com/data/ku/103018/teaching/lecturenotes.pdf
  8. Jan, P., Dux, D., Lips, M., Alig, M., & Baumgartner, D. U. (2014). Analysis of the determinants of the economic and environmental performance of Swiss dairy farms in the alpine area. Proceedings of the 9th international conference on life cycle assessment in the agri-food sector (LCA food 2014), San Francisco, California, USA, 8–10 October 2014.Google Scholar
  9. Jenko, J. (2006). The responsiveness of pork supply. B.Sc. Diploma work. University of Ljubljana, Biotechnical faculty.Google Scholar
  10. Junaid, S., Ali, S., Ali, S., Jan, A. U., & Shah, A. (2014). Supply response analysis of rice in Pakistan: Normalized restricted translog profit function approach. International Journal of Innovation and Applied Studies, 7(3), 826–831.Google Scholar
  11. Kneafsey, M., Venn, L., Schmutz, U., Balázs, B., Trenchard, L., Eyden-Wood, T., Bos, E., Sutton, G., & Blackett, M. (2013). JRC scientific and policy reports – Short food supply chains and local food systems in the EU. A state of play of their socio-economic characteristics. Publications Office of the European Union, Luxembourg: 179 str.Google Scholar
  12. Malla, Y. (2007). Dairy farming in mountain areas. Mountain Research and Development, 27(3), 291–292.CrossRefGoogle Scholar
  13. Mawa, L. I., Kavoi, M. M., Baltenweck, I., & Poole, J. (2014). Profit efficiency of dairy farmers in Kenya: An application to smallholder farmers in Rift Valley and Central Province. Journal of Development and Agricultural Economics, 6(11), 455–465.CrossRefGoogle Scholar
  14. Ministry of Agriculture, Forestry and Food (MAFF). (2016). Accessed September 6, 2016, from http://www.mkgp.gov.si/en/
  15. Musshof, O., Hirschauer, N., & Herink, M. (2009). When should (shouldn’t) one use data envelopment analysis. A critical appraisal. German Journal of Agricultural Economics, 58(2), 114–124.Google Scholar
  16. Nwachukwu, I. N., & Onyenweaku, C. E. (2007). Economic efficiency of Fadana Telfairia production in Imo State Nigeria: A translog profit function approach. Journal of Agricultural Research and Policies, 4(2), 87–93.Google Scholar
  17. Pavelescu, F. M. (2011). Some aspects of the translog production function estimation.Google Scholar
  18. Pearson, D., Henryks, J., Trott, A., Jones, P., Parker, G., Dumaresq, D., & Dyball, R. (2011). Local food: Understanding consumer motivations in innovative retail formats. British Food Journal, 133(7), 886–899.CrossRefGoogle Scholar
  19. Pirog, R., & Bregendahl, C. (2012). Creating change in the food system: The role of regional food networks in lowa. Available September 15, 2014, from http://www.ams.usda.gov/AMSv1.0/getfile?dDocName=STELPRDC5105337
  20. Pöldaru, R., Roots, J., & Viira, A. N. (2005). Estimating econometric model of average total milk cost: A support vector machine regression approach. Economics and Rural Development, 1(1), 23–31.Google Scholar
  21. Prišenk, J. (2015). The effects of value based agro-food chain on the socio-economic situation of dairy farms in mountain regions. Ph. D. thesis. University of Maribor, Faculty of Agriculture and Life Sciences, 138 pp.Google Scholar
  22. Prišenk, J., Borec, A., Janžekovič, M., Grgić, I., Pažek, K., Rozman, Č., & Turk, J. (2016). The economic viability of value-based food chain. Mljekarstvo, 66(3), 231–238.CrossRefGoogle Scholar
  23. Prišenk, J., Grgić, I., Zrakič, M., & Turk, J. (2018). Value-based food chains as an opportunity to improve the economic situation of dairy farms: Translog profit function approach. Mljekarstvo, 68(3), 224–233.CrossRefGoogle Scholar
  24. Prišenk, J., Rozman, Č., Pažek, K., Turk, J., Bohak, Z., & Borec, A. (2014). A multi-criteria assessment of the production and marketing systems of local mountain food. Renewable Agriculture and Food System, 29(4), 345–354.CrossRefGoogle Scholar
  25. Steine, G., Kristofersson, D., & Guttormsen, A. G. (2008). Economic evaluation of the breeding goal for Norwegian red dairy cattle. Journal of Dairy Science, 91(1), 418–426.CrossRefGoogle Scholar
  26. Stern, D. I. (2004). Elasticities of substitution and complementarity. Working papers in economics. Rensselaer Polytechnic Institute, 52 pp.Google Scholar
  27. Stevenson, G. W., Clancy, K., King, R., Lev, L., Ostrom, M., & Smith, S. (2011). Midscale food value chains: An introduction. Journal of Agriculture, Food Systems and Community Development, 1(4), 27–34.CrossRefGoogle Scholar
  28. Stevenson, G. W., & Pirog, R. (2008). Values-based supply chains: Strategies for agrifood enterprises-of-the-middle. In T. Lyson, G. Stevenson, & R. Welsch (Eds.), Renewing an agriculture-of-the middle: Situation and strategy for the center of the U.S. Food system. Pennsylvania: Penn State Press.Google Scholar
  29. Turk, J., Prišenk, J., Čeh, H., & Prezelj, M. (2013). The econometric analysis of cereals purchase in Slovenia. 6th Conference of the Slovene Association of Agricultural Economists (DAES). Krško, 18–19, April 2013, pp. 123–132.Google Scholar
  30. Vacas, L. R., Muenchhausen, S. V., & Haering, A. M. (2014). Strategies for medium-sized value-based food chains during growing process with a particular focus on the business logic and management. Accessed November 11, 2015, from Organicprintsl.org, http://orgprints.org/24924/7/24924.pdf
  31. Viitaharju, L., Lähdesmäki, M., Kurki, S., & Valkosalo, P. (2005). Food supply chains in lagging rural regions of Finland: An SME perspective. University of Helsinki. Accessed November 10, 2015, from https://helda.helsinki.fi/bitstream/handle/10138/17733/Publications4.pdf?sequence=1
  32. Witzke, P., Kempen, M., Dominguez Perez, I., Jansson, T., Sckokai, P., Helming, J., Heckelei, T., Moro, D., Tonini, A., & Fellmann, T. (2009). Regional economic analysis of milk quota reform in the EU. JRC Scientific and Technical Reports. European Commission. 116 pp.Google Scholar

Copyright information

© Springer Nature Switzerland AG 2020

Authors and Affiliations

  1. 1.Faculty of Agriculture and Life Sciences, University of MariborHočeSlovenia
  2. 2.Volgograd State Agrarian University, Prospekt UniversitetskiyVolgogradRussia

Personalised recommendations