Dairy is an important income source for the poor, and often is the purview of women. Cooperatives organize small-scale producers, combining their milk to aggregate storage and shipping costs when selling to a regional dairy that prepares milk for distribution. This structure generates both collective action and coordination problems. Using existing data and a partnership with the Karnataka Milk Federation (KMF), researchers sought understand how existing cooperative networks might be used to improve production incentives through monitoring and punishment, and to address the beliefs and production practices of farmers. Specific objectives of this pilot work were to better understand production processes and frictions, fast-moving quality indicators such as microbial levels and milk quality adulterants, and the extent to which farmers and the cooperative are aware of each other’s production practices. Results found that localized incentives based on milk quality parameters (e.g. microbial load) seems more cost-effective than an overhaul of existing monitoring and payment schemes. An ongoing partnership with researchers will help KMF optimize their model to address milk quality and safety issues. In addition, a full-scale RCT was launched to test both incentives for quality testing and information-sharing about cooperative performance. Full results forthcoming.
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