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The Power of Knowing the Source

Traceability in Kenya's Export Goods

The Power of Knowing the Source: Understanding Traceability in Kenya's Credence Export Goods

By Wanjiru & Makori (2016)

New Institutional Economics Review

Research Summary

This insightful study examines traceability systems in Kenya's credence export goods (like fresh fruits and vegetables) through the lens of New Institutional Economics and Supply Chain Management. The research reveals how traceability builds trust in global markets while addressing implementation challenges.

Wanjiru and Makori present a comprehensive analysis of how traceability serves as both a technical system and a trust-building mechanism in international trade. Their work demonstrates that for products with credence attributes (qualities consumers can't verify), documentation and transparency become critical for market access.

At the heart of this study lies the examination of how formal institutions (like government policies) and informal institutions (like relationships and reputations) interact to enforce standards in Kenya's export value chains. The authors meticulously document how traceability creates competitive advantages in demanding markets like the EU.

Key Findings

  • Traceability systems increase accountability and reduce fraud in export value chains
  • Credence attributes require robust documentation as they can't be verified by consumers
  • Kenyan exporters using traceability systems maintain better EU market access
  • Traceability enables rapid response to food safety incidents (like contamination)
  • The system creates transparent trails from farm to final consumer

One of the study's most significant contributions is its illumination of the challenges and opportunities in implementing traceability:

  • Cost and infrastructure limitations affect adoption in developing economies
  • Institutional capacity building is essential for effective implementation
  • Traceability can unlock premium markets when properly executed
  • The system benefits both producers (through better prices) and consumers (through assurance)

The implications of this research extend beyond Kenya's agricultural exports. Wanjiru and Makori provide valuable insights for:

  1. Developing effective traceability systems in emerging economies
  2. Building consumer trust in credence goods
  3. Designing policies that support export competitiveness
  4. Creating value chains that balance costs with benefits

Ultimately, this study offers both an academic framework and practical insights for agri-business development. It demonstrates how traceability systems can transform from mere compliance tools into strategic assets that drive growth, trust, and market access in global trade.

Policy Implications

The research suggests that trade policies should support traceability infrastructure development while addressing cost barriers for small producers. Effective traceability systems require collaboration between government, private sector, and international partners.