New online market connecting Chinese consumers and small farms to improve food safety and environment

Abstract

In emerging economies where small farms are the main source of food supply, it is costly for the government to monitor and control food safety and production impact on the environment. However, the online food market can potentially give farmers stronger incentives to supply safer and more eco-friendly products, as they can access a national market where consumers are interested in healthy food, and they can differentiate their products by providing production information using videos and pictures. This research uses the choice experiment method to elicit farmers’ preference for production practices and marketing channels in China where e-commerce and delivery businesses are fast-growing. Our main finding is that farmers perceive higher utility in selling safer and more eco-friendly products than conventional products when using e-commerce platforms, evidence of the online market's positive role in food safety enhancement. Our results also identify two types of farmers: traditional farmers and farmers open to the idea of online markets. Farmers who have higher education and live in villages with e-commerce service centers are more likely to be the latter.