Goa Institute of Management Study Integrates Blockchain and Economic Modelling to Improve Agricultural Trade

Goa Khabar: Goa Institute of Management (GIM) researcher has demonstrated that incorporating blockchain technology to enhance transparency and reduce information asymmetry can benefit all stakeholders, including producers, exporters, importers, and processors, involved in the international tomato trade.

In international agricultural trade, buyers often lack the ability to determine the quality of fresh produce prior to purchase. On the other hand, sellers have complete knowledge of it. This situation, known as information asymmetry, leads to inefficient pricing, lack of trust, disputes, and even contract failures.

To address this limitation, Prof Raj V. Amonkar, Professor, Operations and Supply Chain Management at GIM, studied the international tomato trade and its Brix level as a quality indicator in trade. The Brix level is a scientifically established measure of sweetness, ease of processing and the overall quality. Using blockchain technology, the researcher developed a trade system that enables buyers in the international tomato trade to have greater confidence in their purchasing decisions.

The findings of this research have been published in the prestigious Advances in Consumer Research journal.

Key findings of the research include –

Ø  Blockchain-enabled verification significantly reduces the information gap between buyers and sellers by providing transparent, tamper-proof quality records.

Ø  Verified quality information increases buyers’ trust in product quality and their willingness to pay premium prices for high-quality produce.

Ø  Reliable quality verification minimises contractual disputes.

Ø  Verified quality information encourages producers to maintain higher quality standards while enabling buyers to reduce inspection costs and contractual disputes.

Additionally, the research demonstrates that blockchain adoption increases both trade volumes and economic welfare for all participants in the supply chain.

Speaking about the research impact, Prof. Raj V. Amonkar said, “Blockchain technology has the capability to change the fundamental nature of cross-border trade of agricultural products. This research shows that for trades like tomato, if Brix values are captured in a transparent and secure manner, buyers and sellers are better informed and disputes are minimised. I am confident that my research will help build improved, more intelligent, transparent, and sustainable global agri-food supply chains, which will be beneficial to producers, exporters, consumers, and policymakers.”

A unique aspect of the research is its integration of blockchain technology to evaluate how transparent information can influence the overall trading cycle. Contrary to other conceptual studies, this research uses realistic data on tomato quality distributions, logistics costs, and contractual arrangements.

The methodology is applicable to other high-value agricultural products like fruits, spices, coffee, and seafood as well, where the quality of the product is hard to confirm before a purchase is made.

The developed framework is applicable across the global agri-food ecosystem including –

Ø  International traders of fresh and processed tomatoes.

Ø  Farmers aiming to get better prices based on assured quality.

Ø  Importers and food processors with quality assurance needs.

Ø  Cold chain logistics service providers of perishables.

Ø  Policymakers focused on digital agriculture and trade.

Ø  Certification and quality assessment organizations.

Ø  Technology firms working on blockchain-enabled traceability.