Simulating the role of trust in supply development

T. Verwaart, Y. Dijkxhoorn, Christine Plaisier, C.P.A. van Wagenberg

Research output: Contribution to conferenceConference paper

Abstract

Fostering of inclusive business aiming to involve low-income communities
in value chains is a recent approach to alleviate poverty in developing countries.
The approach requires new impact assessment tools to measure changes in
farm income and transaction cost, and behavioural change in value chain relationships.
An agent-based simulation combined with games is proposed for the
assessment of a project developing sorghum production and marketing in Meru
County, Kenya. Contracts between a local sorghum processor and smallholders
have a central role. Trust between farmers and the processor and mutual trust in
farmer groups are key success factors. The simulations indicate that the approach
can lead to increased farm incomes. Continuity of the contract system depends on
the extent to which contracted farmers can be trusted not to side-sell when market
prices are high. However, the simulated production remains at an increased level
even if the contract system breaks down.
Original languageEnglish
Number of pages12
Publication statusPublished - 2016
Event12th Artificial Economics Conference, Rome, 20-21 September 2016 - Rome, Italy
Duration: 20 Sep 201621 Sep 2016

Conference

Conference12th Artificial Economics Conference, Rome, 20-21 September 2016
CountryItaly
CityRome
Period20/09/1621/09/16

Fingerprint

Farmers
Value chain
Sorghum
Continuity
Agent-based simulation
Assessment tools
Key success factors
Marketing
Impact assessment
Income
Simulation
Farm income
Behavioural change
Low income
Inclusive business
Transaction costs
Breakdown
Developing countries
Poverty
Kenya

Cite this

Verwaart, T., Dijkxhoorn, Y., Plaisier, C., & van Wagenberg, C. P. A. (2016). Simulating the role of trust in supply development. Paper presented at 12th Artificial Economics Conference, Rome, 20-21 September 2016, Rome, Italy.
Verwaart, T. ; Dijkxhoorn, Y. ; Plaisier, Christine ; van Wagenberg, C.P.A. / Simulating the role of trust in supply development. Paper presented at 12th Artificial Economics Conference, Rome, 20-21 September 2016, Rome, Italy.12 p.
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Verwaart, T, Dijkxhoorn, Y, Plaisier, C & van Wagenberg, CPA 2016, 'Simulating the role of trust in supply development' Paper presented at 12th Artificial Economics Conference, Rome, 20-21 September 2016, Rome, Italy, 20/09/16 - 21/09/16, .

Simulating the role of trust in supply development. / Verwaart, T.; Dijkxhoorn, Y.; Plaisier, Christine; van Wagenberg, C.P.A.

2016. Paper presented at 12th Artificial Economics Conference, Rome, 20-21 September 2016, Rome, Italy.

Research output: Contribution to conferenceConference paper

TY - CONF

T1 - Simulating the role of trust in supply development

AU - Verwaart, T.

AU - Dijkxhoorn, Y.

AU - Plaisier, Christine

AU - van Wagenberg, C.P.A.

PY - 2016

Y1 - 2016

N2 - Fostering of inclusive business aiming to involve low-income communitiesin value chains is a recent approach to alleviate poverty in developing countries.The approach requires new impact assessment tools to measure changes infarm income and transaction cost, and behavioural change in value chain relationships.An agent-based simulation combined with games is proposed for theassessment of a project developing sorghum production and marketing in MeruCounty, Kenya. Contracts between a local sorghum processor and smallholdershave a central role. Trust between farmers and the processor and mutual trust infarmer groups are key success factors. The simulations indicate that the approachcan lead to increased farm incomes. Continuity of the contract system depends onthe extent to which contracted farmers can be trusted not to side-sell when marketprices are high. However, the simulated production remains at an increased leveleven if the contract system breaks down.

AB - Fostering of inclusive business aiming to involve low-income communitiesin value chains is a recent approach to alleviate poverty in developing countries.The approach requires new impact assessment tools to measure changes infarm income and transaction cost, and behavioural change in value chain relationships.An agent-based simulation combined with games is proposed for theassessment of a project developing sorghum production and marketing in MeruCounty, Kenya. Contracts between a local sorghum processor and smallholdershave a central role. Trust between farmers and the processor and mutual trust infarmer groups are key success factors. The simulations indicate that the approachcan lead to increased farm incomes. Continuity of the contract system depends onthe extent to which contracted farmers can be trusted not to side-sell when marketprices are high. However, the simulated production remains at an increased leveleven if the contract system breaks down.

M3 - Conference paper

ER -

Verwaart T, Dijkxhoorn Y, Plaisier C, van Wagenberg CPA. Simulating the role of trust in supply development. 2016. Paper presented at 12th Artificial Economics Conference, Rome, 20-21 September 2016, Rome, Italy.