Assessment of economic relations between actors of the tomato production chain
Abstract
This article is aimed at analysing the economic interrelation between actors in the tomato production chain in Uzbekistan and find ways to increase the smallholders’ income. We used a PROBIT model to determine the influence of exogenous and endogenous factors on the choice of a small trading partner. The customers that come to the smallholders’ house to purchase the product are regarded as an exogenous factor. More attention needs to be paid to increasing value-added in the food chain in Uzbekistan and improving economic relations between its actors. The factor obtained as an instrumental variable is assessed as having a positive and high impact on the choice of smallholder intermediate trade partner. In other words, an increase in the level of acquaintances of intermediaries with smallholders will increase economic cooperation by 1.2 times, an increase in family income from agriculture by 19% and an increase in smallholder activity in the mahalle by 15.7%. It is estimated that the increase in the number of respondents’ livestock per unit, foreign experience per year and the level of use of credits per unit will increase economic cooperation with direct consumers by 34.4, 13.4 and 28.5%, respectively. It also provides guidelines for tomato farmers to reduce transaction costs and risks and increase their profitability.