Why and how market institutions create incentives for adopting sustainable agricultural practices

This edited volume has gathered together a collection of selected case studies fromaround the world, documented by the innovators themselves. The preceding chaptersdetail how each case has innovated within its organizational and institutional environmentsto create markets for its sustainable products. All the case studies in this volumeare considered “market-driven” innovations. We classify them as such becausethe innovators are relying upon innovative market instruments and institutions tosell products that are cultivated using sustainable agricultural practices. One of theselection criteria for the case studies was proof that the agricultural practices used bythe innovators were in line with the categories documented in FAO’s Save and growpublication (2011). We argue that the 15 cases presented in this book exemplify newways of organizing farmers who practise sustainable agriculture. These new wayshave changed the rules about how farmers and consumers can be linked throughmarket exchanges. In this chapter, we explain how we arrived at this conclusion.The chapter is organized as follows. First, we present our analytical frameworkof “institutional innovations”, which is followed by three sections that explainwhy and how institutional innovations work. We conclude by explaining how it isthrough these institutional innovations that markets act as incentives for the localuse of sustainable practices