Journal Article
Contract and trust are the two main governance mechanisms that influ ence actors’ integration into value chains. Nevertheless, most studies treat trust as a
complement to formal contract, paying less attention on the circumstances in
which trust becomes a sole mechanism of governance. The aim of this article is
to examine how trust shapes integration in the non-industrial timber value chain
in the Southern Highlands of Tanzania. Timber, which is the pillar of the districts’
revenue in the area, contributes significantly to the income of smallholder house holds. The study adopted an exploratory cross-sectional study design whereby data
were collected mainly through in-depth interviews and focus group discussions
with actors of the timber value chain. The findings showed that spot market and
relational governance were the two main linkages in the timber value chain.
Spot market linkage is characterized by absence or little trust, while some trust
is present in relational linkage. In relational linkage, trust helps integration of
actors in the value chain through enabling them access market information,
capital in the form of credit, technology for processing timber, and coordination
and collaboration among the actors. However, trust is associated with some chal lenges and to some actors, it plays an exclusionary role. The study recommends for
the promotion of trust along with other social control mechanisms such as social
knowledge in order to address these challenges