The Research On Vertical Coordination Of China's Fresh Vegetable Industry

With the improvement of people's living standard,the problem of vegetables quality safety receives people's general concem more and more.In recent years,the residue of pesticides of vegetables still generally exceeds standard,the poisoning of edible vegetables happens occasionally,and the export trade dispute increases day by day in our country.How to guarantee vegetables safety are both helpful to improve people's life and health level and important condition of strengthening industry's competitiveness of vegetables of our country.Domestic and international scholars have made a large number of theory and experience researches on food safety problem from different angle.These researches can be roughly divided into two kinds:One is theory basic research,mainly uses the information asymmetry theory and supply chain management theory to explain why the food safety problem produced;the other is behavioral research employing the theory described above.There are two common characteristics among these researches:(1) their focuses are all food safety with experience and credence attributes;(2) they are all based on two core concepts:information asymmetry and transaction costs.However,two questions need to be further discussed or faced:first,the relation between information asymmetry and transaction costs is seldom discussed,and what has determined the given information structure?Second,in the previous study of vertical coordination in fresh vegetable industry, researchers always paid their attention on the process of production.However,in the process of selling,the adverse selection,which is brought by the information asymmetric, also exerts great influence on vertical coordination.But,this research area is a virgin land. The answers to these questions are not only essential,but also urgent for us to understand clearly the nature of food safety problem and choose effective governance structure.Based on the existing research results,employing model deductive method, comparative institutional analysis,case study and induction method,the report has reviewed the nature and origin of vegetable quality safety problem(information asymmetry) with conscious credence attribute that has been known by people in our country.In addition,some other important issues are discussed.Such as,with the enhance of food safety management,how the organization structure of fresh vegetable industry will evolve.And which type of vertical coordination and what kind of institution environment provided by government can benefit for supplying high quality fresh vegetable.The main conclusions herein are as follows:(1) In China,the fundamental reason for the vegetable quality problem is the credence attribution of vegetable.In other words,the quality attributions of vegetable are abundant,such as appearance,taste,pesticide residues,the environment and process of production,etc.Most of these attributions,such as pesticide residues,consumers even can not know them even they consume the vegetable.What is more,if lacks of proper stimulation,the producers of vegetable do not have incentives to send signal of quality. Then,the bad quality and low price vegetable would occupy whole market.(2) To transmit the information of quality to consumers,and to separate itself to other firms,the vegetable firms hold high ability need send high-cost signal.This would make these firms prolong their chains to the terminal.On the other hand,to guarantee the quality of vegetable,the firms would use more intensive backward coordination to control the quality directly.(3) All kinds of signals of vegetable quality can not insure the safety of vegetable automatically.In addition,in the process of decision-making,consumers only resort to the signals which have high reputation.Especially,because there are lacks of effective administration,some authentications lost the value of signaling.In this situation, consumers prefer brand of firms or vegetables to the authentications.