Smallholder value creation in agrifood chains: Value network approach

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To much of the development community, improving the inclusiveness of agrifood chains demands private institutional innovations that attenuate market failures confronting smallholders. How and how well such innovations contribute to sustainable rural development is still poorly understood, however, with research to date insufficiently generalizable to inform policy and practice. This partly stems from excessive reliance on instrumental and lead firm-centric perspectives on value creation that fail to recognize the complex organizational networks required to include, empower, and upgrade smallholders. To improve the explanatory capacity of existing theories and approaches, this article reconceptualizes how smallholders and other chain and non-chain actors derive value from participating in agrifood chains. Our ‘value networks’ inspired approach helps scholars and evaluators investigate and causally attribute how different types of value are created and captured through different types of private institutional innovations. We furthermore demonstrate how the approach can be used to generate the knowledge needed to advance business practice, development policy, and global value chain, global production network, and household theories.

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