Identifying the precursors of vulnerability in agricultural value chains: A system dynamics approach

Conventional approaches for assessing supply chain vulnerability do not capture endogenous disruptions emanating from chain actors’ decisions that might increase value chain vulnerability. These approaches adopt a reactive analytical explanation of vulnerability, rather than one that considers issues of feedback effects. To address this issue, this paper adopts a system dynamics modelling approach to identify the precursors of vulnerabilities in Ghana’s cocoa value chain. The paper assesses the vulnerability levels of the cocoa value chain by adjusting the baseline values of several key parameters that can be influenced by chain actors. Results of the sensitivity analyses indicate that the precursors of vulnerability situated upstream of the cocoa value chain have varying impacts on chain vulnerability, but the same magnitude of effect on the vulnerability levels of chain actors. However, precursors of vulnerability that are situated midstream of the cocoa value chain have an unequal magnitude of effect on the vulnerability levels of chain actors. Results suggest that policies governing cocoa trading can become countervailing factors that obstruct the government’s call for upgrading along the cocoa value chain. The system dynamics model presented here enables a proactive assessment of vulnerability which can facilitate collaborative planning among stakeholders in the value chain. © 2019 Informa UK Limited, trading as Taylor & Francis Group.