Academic journal article American Journal of Entrepreneurship

The Impact of Contracting and Property Rights Institutions on Entrepreneurship in the United States

Academic journal article American Journal of Entrepreneurship

The Impact of Contracting and Property Rights Institutions on Entrepreneurship in the United States

Article excerpt


Strengthening local food systems has been proposed as one solution to the decline in the economic vitality of rural communities. Paradoxically, the consolidated food system, designed to bring an abundance of inexpensive food to Americans, has resulted in increased concerns about food safety (Sustainable Table, 2013; New York Times, 2013), food deserts, and obesogenic diets that lead to increasing rates of costly chronic diseases (O'Kane, 2010). Rural communities are particularly affected, as the inability of small and medium sized farms to compete with large agribusiness has weakened local economies. In rural communities, access to affordable, healthy food is problematic, with local grocery stores commonly being replaced by convenience stores or big box stores that require long travel times (Jilcott et al., 2010). In consequence, compared to urban areas, rural communities have higher rates of poverty, fewer options to shop for healthy foods (Liese, Weis, Pluto, Smith, & Lawson, 2007; Blanchard & Lyson, 2006), higher economic barriers to accessing healthy foods, and higher rates of obesity and nutrition-related chronic diseases (Tai-Seale & Chandler, 2003; Befort, Nazir, & Perri, 2012).

While there is no consensus on the definition of local food systems, most agree that they are locally or regionally based, more ecologically sustainable compared to conventional agriculture, more affordable for consumers, and economically viable for producers (Schmidt, Kolodinsky, DeSisto, & Conte, 2011; Feenstra, 1997; Garrett & Feenstra, 1999).

In addition to promoting sustainable agriculture and improving local economies, local food systems are purported to create better access to healthy foods and improve the diets of local residents, thus providing a link to improved public, as well as economic, health. Four entrepreneurial food systems innovations include farmers' markets, community supported agriculture (CSAs), farm to institution programs, and food hubs. Depending on the community and geography, these innovations span the diffusion of innovations spectrum, from adoption by innovators through laggards, and link with the product life cycle from introductory programs through mature enterprise (Rogers, 1962). While fanners' markets may appear to be the most mature of the four innovations, their concentration and potential for farmer income has been realized mainly on the United States east and west coasts. CSAs have diffused from the coasts to the eastern plains and Colorado. Farm to institution is most developed in school systems, but increasing in restaurants, health care, penal institutions and other venues. Food hubs are the least developed, but are gaining traction around the country (Martinez et al., 2010).

While it is posited that entrepreneurial local food systems innovations enable producers to make a living, improve the local economy, and improve public health among local residents, few have attempted to evaluate the evidence to determine if these results can be attributed to the innovations themselves. Therefore, we conducted a comprehensive literature review of the evidence to determine whether entrepreneurial local food systems innovations:

1) enable producers to make a living;

2) improve local economies;

3) provide local residents with greater access to affordable, healthy food; and

4) contribute to greater consumption of healthy food among local residents.

Conceptual Framework

Figure 1 displays a conceptual model of how a local food system might, in addition to bringing revenue to producers and other businesses in the supply chain, improve the local economy as well as personal incomes, thereby enabling residents to have increased access to local, healthy foods. The model begins with the local food system (within the box), showing direct and intermediated distribution channels to markets and consumers. Direct distribution, shown as the lower distribution route in the model, refers to farmers selling directly to consumers through entrepreneurial innovations like farmers' markets, CSAs, or direct sales to schools, restaurants, and other institutions (farm to institution). …

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