Abstract

The last decades have seen a revival of short food supply chains (SFSCs) with consumers having increasingly higher expectations regarding the quality, the origin and the safety of the food. In this paper, we examine the trade-off between quality, affordability and sustainability of food products locally grown. We use a model that borrows from both spatial economic and monopolistic competition theories and allows to properly account for the urban-rural linkages. We highlight that spatial heterogeneity in productivity and land quality create distortions in competition between farmers, and can have concomitant undesired effects on the quality, the price, the ‘greenness’, and the range of available varieties. Additionally, we emphasize a nontrivial relationship between the city size and the set of food varieties which truly relies on the shape and the strength of the spatial externalities.

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