Excess Competition among Food Hubs
Food hubs offer a novel solution to connect small and mid-sized local farms, which individually
lack the scale to profitably market their products. Because many food hubs rely on grants and
philanthropy to provide services and are not necessarily profit-driven, markets may unintentionally
oversaturate due to overinvestment. We use a firm-entry model to estimate the average U.S. county
population necessary for one, two, and three food hubs to break even. Our findings suggest
that policy makers and philanthropists need to consider the carrying capacity of the local food
environment and population prior to supporting additional food hubs.
Authors: Rebecca Cleary, Stephan J. Goetz, Dawn Thilmany McFadden, Houtian Ge
Publication: Journal of Agricultural and Resource Economics Date Published: January 1, 2019