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Transmission of Rice Prices from Thailand into West African Markets: The Case of Benin, Mali, and Senegal

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  • Rose Fiamohe
  • Didier Y. Alia
  • Ibrahima Bamba
  • Aliou Diagne
  • Eyram Amovin-Assagba

Abstract

The integration of West African rice market to the world market is assessed in order to derive the implication for food security. To this end, the transmission of rice price changes on the world market to selected markets in West Africa was examined to test for the presence of transaction costs. Using the two-regime threshold cointegration procedure on monthly price data, evidence in support of the hypothesis of asymmetric price transmission was found between Thailand and some West African markets. Price increases on the world market were more quickly transmitted to domestic price than were price decreases in Benin and Mali, suggesting short-run dynamic inefficiencies and the presence of transaction costs. In Senegal, the adjustment was linear, suggesting greater integration with the world rice market. The results suggest that West African governments should design and implement adequate policies to develop the domestic rice sector, improve market infrastructures in order to reduce their country dependency to international markets and ensure food security.

Suggested Citation

  • Rose Fiamohe & Didier Y. Alia & Ibrahima Bamba & Aliou Diagne & Eyram Amovin-Assagba, 2015. "Transmission of Rice Prices from Thailand into West African Markets: The Case of Benin, Mali, and Senegal," Journal of African Business, Taylor & Francis Journals, vol. 16(1-2), pages 128-143, January.
  • Handle: RePEc:taf:wjabxx:v:16:y:2015:i:1-2:p:128-143
    DOI: 10.1080/15228916.2015.1059159
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    Citations

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    Cited by:

    1. John Ssozi & Simplice Asongu & Voxi Heinrich Amavilah, 2019. "The effectiveness of development aid for agriculture in Sub-Saharan Africa," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 46(2), pages 284-305, March.
    2. Didier Yélognissè Alia & Aliou Diagne & Patrice Adegbola & Florent Kinkingninhoun, 2018. "Distributional Impact of Agricultural Technology Adoption on Rice Farmers’ Expenditure: The Case of Nigeria in Benin," Journal of African Development, African Finance and Economic Association (AFEA), vol. 20(2), pages 91-103.
    3. Ssozi, John & Asongu, Simplice & Amavilah, Voxi, 2017. "Is Aid for Agriculture Effective in Sub-Saharan Africa?," MPRA Paper 83073, University Library of Munich, Germany.
    4. Kouyate, Carolin & von Cramon-Taubadel, Stephan & Fofana, Ismael, 2016. "Proximity and price co-movement in West African rice markets," African Journal of Agricultural and Resource Economics, African Association of Agricultural Economists, vol. 11(3).
    5. Bairagi, S. & Mohanty, S., 2018. "Analysis of Price Transmission along the Cambodian Rice Value Chain," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277022, International Association of Agricultural Economists.
    6. Harold Glenn A. Valera & Mark J. Holmes & Valerien O. Pede & Jean Balié, 2023. "How convergent are rice export prices in the international market?," Agricultural Economics, International Association of Agricultural Economists, vol. 54(1), pages 127-141, January.

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