Price Transmission and Trader Entry in Domestic Commodity Markets
AbstractUsing detailed data from three simultaneous surveys of producers, traders, and exporters, this paper examines the transmission of international coffee prices through the domestic value chain in Uganda. We find that producer price fluctuations are inconsistent with constant transaction costs. We investigate three possible explanations for this finding: storage and contango, marketing costs that increase with price, and trader entry that raises search time. We test and reject the storage and marketing costs explanation, but we find some evidence of trader entry in response to a rise in export price. Our findings suggest that small itinerant traders enter in response to an export price increase, probably taking advantage of farmers’ ignorance of the rise in wholesale price.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by University of Chicago Press in its journal Economic Development and Cultural Change.
Volume (Year): 56 (2008)
Issue (Month): ()
Contact details of provider:
Web page: http://www.journals.uchicago.edu/EDCC/
Other versions of this item:
- Marcel Fafchamps & Ruth Hill, 2005. "Price Transmission and Trader Entry in Domestic Commodity Markets," Economics Series Working Papers GPRG-WPS-038, University of Oxford, Department of Economics.
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Marcel Fafchamps & Ruth Hill, 2004.
"Selling at the Farm-Gate or Travelling to Market,"
Economics Series Working Papers
WPS/2004-30, University of Oxford, Department of Economics.
- Gerald E. Shively, 1996. "Food Price Variability and Economic Reform: An ARCH Approach for Ghana," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(1), pages 126-136.
- Bob Baulch, 1997. "Transfer Costs, Spatial Arbitrage, and Testing for Food Market Integration," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(2), pages 477-487.
- Deaton, A-S & Miller, R-I, 1995.
"International Commodity Prices, Macroeconomic Performance, and Politics in Sub-Saharan Africa,"
Princeton Studies in International Economics
79, International Economics Section, Departement of Economics Princeton University,.
- Deaton, Angus & Miller, Ron, 1996. "International Commodity Prices, Macroeconomic Performance and Politics in Sub-Saharan Africa," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 5(3), pages 99-191, October.
- Badiane, Ousmane & Shively, Gerald E., 1998. "Spatial integration, transport costs, and the response of local prices to policy changes in Ghana," Journal of Development Economics, Elsevier, vol. 56(2), pages 411-431, August.
- Staatz, John M. & Dione, Josue & Dembele, N. Nango, 1989. "Cereals market liberalization in Mali," World Development, Elsevier, vol. 17(5), pages 703-718, May.
- N.M.Henstridge, 1997. "The reconstruction of a macroeconomic dataset for Uganda," Economics Series Working Papers WPS/1998-03, University of Oxford, Department of Economics.
- Fafchamps, Marcel & Gavian, Sarah, 1996. "The Spatial Integration of Livestock Markets in Niger," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 5(3), pages 366-405, October.
- Pranab Bardhan & Dilip Mookherjee & Masatoshi Tsumagari, 2013.
"Middlemen Margins and Globalization,"
American Economic Journal: Microeconomics,
American Economic Association, vol. 5(4), pages 81-119, November.
- Dilip Mookherjee & Pranab Bardhan & Masatoshi Tsumagari, 2011. "Middlemen Margins And Globalization," Boston University - Department of Economics - Working Papers Series WP2011-034, Boston University - Department of Economics.
- Charles Kunaka, 2011. "Logistics in Lagging Regions : Overcoming Local Barriers to Global Connectivity," World Bank Publications, The World Bank, number 2543, March.
- Antras, Pol & Costinot, Arnaud, 2011.
4784024, Harvard University Department of Economics.
- Mujawamariya, Gaudiose & Burger, Kees & D'Haese, Marijke F.C., 2012. "Behaviour and performance of traders in the gum arabic supply chain in Senegal: Investigating oligopsonistic myths," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126236, International Association of Agricultural Economists.
- Cason, Timothy N. & Gangadharan, Lata, 2011. "Price discovery and intermediation in linked emissions trading markets: A laboratory study," Ecological Economics, Elsevier, vol. 70(7), pages 1424-1433, May.
- Jenny Aker & Christopher Ksoll, 2012. "Information Technology and Farm Households in Niger," Working Papers 2012-005, United Nations Development Programme, Regional Bureau for Africa (UNDP/RBA).
- Raballand, Gael & Macchi, Patricia & Merotto, Dino & Petracco, Carly, 2009. "Revising the roads investment strategy in rural areas : an application for Uganda," Policy Research Working Paper Series 5036, The World Bank.
- Latynskiy, Evgeny & Berger, Thomas, 2012. "An Agent-Based Network Approach For Understanding, Analyzing And Supporting Rural Producer Organizations In Agriculture," 52nd Annual Conference, Stuttgart, Germany, September 26-28, 2012 137383, German Association of Agricultural Economists (GEWISOLA).
- Subervie, Julie, 2011. "Producer price adjustment to commodity price shocks: An application of threshold cointegration," Economic Modelling, Elsevier, vol. 28(5), pages 2239-2246, September.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Journals Division).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.