Comparative advantage

A comparative advantage exists when either the supply or demand conditions allow UPA to serve the market better by supplying produce other­wise unavailable or prohibitively expensive.

Urban producers can achieve greater efficiencies by using under-utilised resources in the city, such as vacant land, city compost, and unemployed labour. Productivity of UPA can be as much as 15 times greater than that of rural agriculture although yields may suffer from insufficient inputs, skills, and municipal support (FAO, 1998).

As most food is a basic commodity, it has a relatively stable and dependable demand which reduces the associated risks in its production and sale. Urban farmers often have a comparative advantage in spe­ciality produce and markets (e. g. high value and organic) and these specialist UPA activities often become the sole, or a major source of, income.

Farmers close to markets can respond promptly to changes in consumer tastes and demand. Greater responsiveness and availability may often lead to improved quality and nutrient content of produce (Jones, 2001). The close proximity of producers to markets means there is less need for transport, storage and refrigeration equipment and infrastruc­ture. It is also likely to mean better communication, control of supply and quality of produce. For both commercial and home gardeners, the close prox­imity to market or home saves time and effort and reduces shoe leather costs. However, in the North, some urban farmers in a city, located there perhaps for historical reasons, may supply wholesalers and retailers with national distribution systems, so any cost and environmental advantage will be lost.