Standardization on brazilian produce: a measurement cost approach / Adoção de padrões em produtos agrícolas no Brasil: uma abordagem da teoria de custo de mensuração

AUTOR(ES)
DATA DE PUBLICAÇÃO

2007

RESUMO

Why are official standards not adopted in the market for fresh food in Brazil? Despite the advantages widely claimed by economic theory, official standards are proposed but not adopted. Agricultural markets include uncertainty derived from inherent characteristics such as variability and perishability. Standards homogenize goods, leading to more competitive markets. It is to be expected that agents will adopt standards to reduce variability. However in the major Brazilian wholesale markets, the present grade system is unpredictable, and agents have been refusing to accept new official standards. Products are classified according to the quality observed and then the prices are established. Each day a new grade is ascribed. In some cases, not only do prices oscillate daily, but also what is defined as grade "A" today might be considered grade "2A" tomorrow. Since official standard is voluntary, we assume the adoption as an organizational decision of each firm. Two hypotheses are made. Agents will face benefits and costs before and after the adoption of a new standard. If the costs are higher than the expected benefits, agents will reject the standard. According to the "governance perspective", even when net gains are expected, agents tend to resist standard adoption if it requires specific asset investment and safeguards will be required in order to protect quasi rents. The second hypothesis is, agents dontadopt standards since they get benefits from the lack of delimitation of attributes through capturing margins in public domain. Thus, measurement costs of attributes based on official standards are affecting standard adoption. Empirical analysis is focused on fresh tomato wholesaler-retailer transactions on the main Brazilian wholesale market. The research integrates: analysis of the contractual arrangement and market structure of the agents involved in the transaction; a case study; and an analysis of the causal relations between official standard adoption and measurement costs and asset specificity. Data sources: survey of wholesalers and retailers; exploratory interviews with wholesale market agents. Standardization requires high level of specific investments. Technology is product specific thus costs would be high. Thus according to governance perspective there are no incentives for agents to invest in technology. The findings are low level of specific investments, secondary uncertainty (Willianson, 1985) derived from potential merchandise return and a high frequency of transaction. About measurement costs, these are potentially high since agents take several hours to buy the product and consumers complain about doing the selection. Long ago, public administration spent resources trying to introduce unambiguous standards. The results may contribute to public policy by showing the determinants based on efficiency principles that are confounding the implementation of standards.

ASSUNTO(S)

transaction cost agricultural products-standards custo de transação produtos agrícolas - padrões agribusiness produtos agrícolas agricultural products

ACESSO AO ARTIGO

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