Small-scale farmer participation in new agri-food supply chains: Case of the supermarket supply chain for fruit and vegetables in Honduras

This paper explores the role of transaction costs and collective action in shaping small-scale farmer participation in the fresh fruit and vegetable (FFV) supply chain to supermarkets (SSC) in Honduras. Transaction costs and collective action are found to be significant in determining farmer participation in the SSC. Contrary to the findings of other studies, human capital and farm characteristic variables are not significant, suggesting that small-scale farmers can be included in new supply chains under certain conditions, especially if incentives to farmers, trust-based relationships between buyers and sellers, risk reduction practices and new forms of collective action are put in place. Copyright © 2008 John Wiley & Sons, Ltd.