Better together? The effect of VietGAP and PGS certification on farmers’ welfare in Vietnam by Laura Enthoven

To promote sustainable agriculture in low- and middle-income countries, local certification schemes and participatory guarantee systems (PGS) have been promoted as inclusive mechanisms. In this study, we investigate the implications of two local certification schemes for farmers in Vietnam: VietGAP, a simplified version of GlobalGAP certified by a third-party body, and PGS, based on sustainable agricultural practices controlled internally by farmers and other local stakeholders. We use farm-household data from a two-round panel survey conducted in 2018 and 2022 among 301 vegetable farmers. First, we investigate factors that may affect farmers’ adoption of the two schemes. Second, we estimate correlated random effects models to evaluate the schemes’ effect on farmers’ welfare while accounting for unobserved time-constant factors. We do not find evidence that either certification scheme has an effect on household revenues and income from vegetables. However, we report negative costs and price effects, but positive market access effects linked to certification.