Fairness, Farmers Markets, and Local Production

Abstract

The significant changes in agriculture in re-cent decades, including consolidation and vertical integration, the adoption of contro-versial technologies, and food safety scares, have led some to question whether the bene-fits and costs of these developments have been equally distributed among all participants in the agricultural supply chain. These concerns have sparked mainstream consumer interest in “alternative ” products like organics, Fair-Trade, local and regional origin, farmers mar-kets, no-GMO, no growth hormone, etc., that advertise improved sustainability and product quality. Why are such products becoming more popular? Unfortunately, existing market data are insufficient to conclusively identify and ex-plain the growing appeal of such products. A wealth of evidence has begun to accu-mulate in the growing field of behavioral and experimental economics that people care not only about their own monetary well-being but also the well-being of others (e.g., see the re-view by Roth 1995). Evidence from labora-tory experiments further suggests that people care about inequality, efficiency, and distribu-tion of outcomes (e.g., Engelmann and Strobel 2004). The literature on the economics of char-itable donations has found similar results but has also noted that other-regarding behavior is significantly influenced by: framing of the task or decision (Eckel and Grossman 2008); being in the lab versus the field (Levitt and List 2007); and by individual-specific effects