Tracing the effects of good purchasing practices on income diversification by cocoa farmers in Ivory Coast

The goal of enabling cocoa farmers to earn a living income has become main stream among industry, producer-country governments, and NGOs. Good purchasing practices by chocolate manufacturers and cocoa traders are considered one important component in reaching this goal. Yet even with improved purchasing practices, a significant share of farmers will not achieve a living income from cocoa alone and will require additional, diversified income opportunities. However, little research has so far been done to examine how purchasing practices influence income diversification. Using an in-depth case study research design, we trace the mechanisms through which the good purchasing practices of a European chocolate manufacturer affect income diversification by cocoa farmers in Ivory Coast. The results show that these practices positively influence income-generating activities by strengthening financial and human capital at the cooperative level and among a subset of member farmers. They also improve planning security and access to finance, but only at the cooperative level and not for individual farmers. Furthermore, good purchasing practices alone are insufficient to create the income-generating activities required for all cocoa-farming households to achieve a living income. Attaining this objective depends decisively on a broader structural transformation of Ivory Coast's rural economy. These insights contribute to improving good purchasing practices as part of smart mixes of measures to support living incomes.