We study a small farmer’s optimal market choice in the presence of multiple markets in an emerging economy. A small farmer sells her product through either of the three markets available: government-regulated market, corporate-owned market (a private market having high-quality requirements), and fixed-price market (a government procurement center). Using a dynamic game of incomplete information, we examine the impact of technology choice, quality effort, and yield quantity on the farmer’s market choice. We discuss the implications of the full information and asymmetric information case analysis with the help of real-life examples. We find out that the farmer does not put her optimal quality effort due to misalignment of stakeholder payoffs. We analytically prove that market inefficiency exists due to this misalignment; we subsequently propose that contract farming can eliminate this problem. We demonstrate that the corporate-owned and government-regulated markets have individual incentives to keep their markets segregated by maintaining different threshold quality requirements. We conduct a logistic regression analysis to explain the impact of various parameters on the small farmer’s market choice. It shows the impact of change in critical parameters on the small farmer’s optimal market choice. Our analysis allows policymakers to understand the behavior of small farmers as strategic players. Our study emphasizes the importance of the threshold quality requirement of markets and prices offered in these markets on a small farmer’s market choice rather than traditional factors such as transportation cost and minimum support price. We conduct field interviews of small farmers to augment our findings.

我们研究新兴经济体存在多个市场时小农的最佳市场选择。小农通过三个可用市场之一销售产品：政府监管市场、企业所有市场（具有高质量要求的私人市场）和固定价格市场（政府采购中心）。使用不完全信息的动态博弈，我们研究了技术选择、质量努力和产量对农民市场选择的影响。我们借助现实生活中的例子来讨论完整信息和不对称信息案例分析的含义。我们发现，由于利益相关者收益的失调，农民没有付出最佳的质量努力。我们通过分析证明，由于这种失调，市场效率低下的存在；我们随后建议订单农业可以消除这个问题。我们证明，企业拥有和政府监管的市场有个体激励，通过维持不同的阈值质量要求来保持市场隔离。我们进行逻辑回归分析来解释各种参数对小农市场选择的影响。它显示了关键参数的变化对小农最优市场选择的影响。我们的分析使政策制定者能够了解小农作为战略参与者的行为。我们的研究强调了市场的门槛质量要求和这些市场提供的价格对小农市场选择的重要性，而不是运输成本和最低支持价格等传统因素。我们对小农进行实地采访以增强我们的发现。