The relationships among market, state, and civil society have undergone dramatic shifts since the rise of neoliberal globalization in the mid-1980s. These changes have reshaped how agricultural commodities move through global value chains, who sets quality standards, and ultimately who holds power in food systems. Understanding these transformations is essential for grasping contemporary challenges in agriculture and social justice.
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How neo-liberal policies restructured global value chains
Starting in the mid-1980s, governments worldwide began adopting neoliberal economic policies that emphasized free markets, privatization, and reduced state intervention. These policies removed barriers to global capital flow and fundamentally changed how agricultural products are produced, processed, and distributed.
The impact on value chains was profound. Neoliberalism promised economic growth through free market practices, but it also shifted power away from producers toward those who controlled distribution and marketing. In agricultural value chains, this meant that raw commodity producers, particularly farmers growing food crops, lost significant control over production decisions and pricing.
One clear example of this shift is the privatization of state-run agricultural companies. Governments that once managed agricultural supply chains through extension services, input provision, and market access now facilitated private companies taking over these roles. The state’s function changed from direct involvement to creating favorable conditions for private capital flows.
This restructuring disadvantaged smallholder farmers in particular. Contract farming arrangements became common, where companies provide seeds, fertilizer, and credit on loan to farmers, then purchase their crops at predetermined prices. While this provides market access, it also transfers production management from public entities to private corporations, reducing farmers’ autonomy and negotiating power.
The transformation from market convention to industrial convention
To understand these changes more deeply, we need to examine how the governing logic of agricultural commodities shifted. Conventions are shared norms and standards that coordinate economic activity. In agriculture, the dominant convention changed from a market-based approach to an industrial one.
Market convention operates on simple price-based competition. The primary criterion for exchange is finding the lowest price for a standardized commodity. A farmer selling wheat in a market convention system would succeed by offering the cheapest product that meets basic grade standards.
Industrial convention, however, introduces multiple quality criteria beyond price. Products must meet complex specifications regarding size, appearance, chemical residues, processing suitability, and traceability. Success depends on adhering to detailed technical standards set by buyers or industry bodies.
This shift had dramatic consequences for producers. They lost control over production processes as they had to adapt to standards set by downstream buyers. Farmers could no longer simply grow crops and sell them at market prices. Instead, they needed to invest in specific inputs, follow prescribed practices, maintain records, and often undergo third-party certification to access value chains.
The “quality turn” in food systems exemplifies this transformation. Consumers and retailers increasingly demand products differentiated by attributes like organic production, fair trade certification, or geographic origin. While this creates opportunities for some producers to capture premium prices, it also imposes costs and requirements that exclude many smallholders from profitable markets.
Civil society as intermediary in the neo-liberal era
In this restructured landscape, civil society organizations have emerged as crucial intermediaries between market forces, state policies, and agricultural communities. The pattern is clear: the market drives economic activity through demand and purchasing power, the state facilitates by creating enabling policy environments, and civil society mediates by advocating for social and environmental standards.
Civil society’s role in standard-setting has become particularly important. When governments reduced their regulatory presence, civil society organizations stepped in to develop codes of practice for sustainable agriculture. Organizations representing farmers, consumers, and environmental groups participate in creating voluntary standards that govern how food is produced and traded.
For example, organic agriculture standards and fair trade certifications emerged largely through civil society initiatives. These alternative quality conventions challenge industrial models by emphasizing environmental sustainability, social equity, and farmer livelihoods rather than just efficiency and price.
However, civil society’s intermediary role faces challenges. In agricultural policy forums, civil society organizations often struggle to influence decisions dominated by government and corporate interests. The power asymmetries are real: large agribusinesses have resources and political access that smallholder farmer organizations typically lack.
The key struggle revolves around who sets the standards for agricultural products and their externalities like environmental impacts. Will standards prioritize corporate efficiency and consumer convenience, or will they incorporate farmer welfare and ecological sustainability? Civil society organizations work to ensure diverse voices, especially those of small-scale producers facing food insecurity, participate in these crucial decisions.
Understanding conventions theory
Conventions Theory provides a framework for analyzing these dynamics. Developed by French economists in the 1980s and 1990s, this approach examines how economic coordination occurs through shared norms, values, and institutions rather than just market prices.
The theory identifies different “worlds of production,” each governed by distinct conventions:
Market convention coordinates through standardized products and price competition. Quality is generic and easily measurable. Think of commodity grain markets where products are graded by moisture content and test weight.
Industrial convention coordinates through technical standards and efficiency. Quality is defined by conformity to precise specifications. Modern food processing chains operate largely in this world, requiring suppliers to meet detailed requirements.
Domestic convention relies on trust, tradition, and personal relationships. Quality is established through reputation and direct knowledge. Local food systems and artisanal production often function through domestic conventions.
Civic convention prioritizes collective welfare and social benefits. Quality includes environmental sustainability and social justice. Organic and fair trade systems exemplify civic conventions in agriculture.
In agri-food systems, research using Conventions Theory has focused on alternative value chains built around civic or domestic conventions. These alternatives challenge mainstream industrial models by embedding different values into economic exchange.
The value of this theoretical framework lies in revealing that economic coordination is not natural or inevitable. The standards governing agriculture reflect political choices about what society values. When industrial conventions dominate, they privilege efficiency and corporate control. When civic conventions gain ground, they create space for environmental protection and farmer empowerment.
Implications for the future
The transformation of market-state-civil society relations under neoliberal globalization has created a paradox. On one hand, reduced state intervention was supposed to free markets and increase efficiency. On the other hand, it has led to concentrated corporate power, exclusion of smallholders, and social and environmental externalities that markets alone cannot address.
Civil society organizations working in agriculture must navigate this terrain strategically. They cannot rely on state regulation alone, given governments’ commitment to facilitating private sector activity. Yet they also cannot accept market-driven outcomes that disadvantage vulnerable producers and degrade ecosystems.
The struggle over conventions and standards will continue to shape agricultural futures. Will value chains be governed by industrial efficiency focused on corporate profits, or will civic conventions centered on sustainability and equity gain influence? The answer depends partly on whether civil society can build alliances strong enough to challenge the dominant neoliberal framework.
Understanding these dynamics through Conventions Theory helps reveal what is at stake. Standards are not merely technical details but expressions of power relations and social priorities. When we examine who participates in setting agricultural standards and whose interests those standards serve, we see the ongoing contest between different visions of how food systems should function.
What do you think? How can smallholder farmers gain more power in global value chains? What role should governments play in regulating agricultural standards to protect both producers and consumers?
References
- https://www.britannica.com/money/neoliberalism
- https://www.imf.org/en/publications/fandd/issues/series/analytical-series/cafe-econ-a-new-political-order-emerges
- https://pmc.ncbi.nlm.nih.gov/articles/PMC6815986/
- https://link.springer.com/referenceworkentry/10.1007/978-3-030-52130-1_74-1
- https://www.fao.org/4/Y8704e/Y8704e.htm
- https://www.ijsaf.org/index.php/ijsaf/article/view/221
- https://www.fao.org/4/x2214e/x2214e03.htm
- https://link.springer.com/chapter/10.1007/978-3-319-75328-7_4
- https://www.taylorfrancis.com/chapters/edit/10.4324/9781351210041-4/convention-theory-anglophone-agri-food-studies-emmanuelle-cheyns-stefano-ponte
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