THE GROWING ROLE OF CONTRACT FARMING IN AGRI-FOODSYSTEMS DEVELOPMENT:DRIVERS,THEORY AND PRACTICE
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The interest in contract farming as a mechanism to coordinate linkages betweenfarmers and agribusiness firms has increased considerably in the recent past.Thispaper reviews the changes in agri-food systems that are leading to tightercoordination ofsupply chains and discusses the theoretical basis for contract farmingas a chain governance strategy.It is argued that the need to minimize transaction costsin light ofincreasing uncertainty,asset specificity and market failures associated withchanges in agri-food systems will continue favouring the intensification ofcontracting in supply chain management in food and agriculture.