Abstract
Consumers rely on different channels to supply with agricultural products such as traditional purchase at food stores, contract with local farmers or household production. The primary purpose of this paper is to explain this variety by using the theoretical framework of transaction cost economics à la Williamson-Barzel. We emphasize the role of ‘difficultness of measurement’ in selecting a supply mode and draw several testable implications and policy considerations. An empirical test is conducted to determine whether the measurement difficulty explains the commitment of households in long term contracts with farmers.