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The Impact of Coffee Price Changes on Rural Households in Uganda

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  • Bussolo, Maurizio
  • Godart, Olivier
  • Lay, Jann
  • Thiele, Rainer

Abstract

Based on household survey data, this paper investigates the impact on coffee and non-coffee households of the pronounced coffee price fluctuations in Uganda during the 1990s. As expected, the price boom of the early 1990s was associated with substantial poverty reduction for coffee farmers. More strikingly, their poverty incidence continued to go down when prices fell again. This may be explained by a combination of factors: first, coffee production increased after 1995, probably as a delayed response to improved price incentives; second, there is evidence of consumption smoothing among specialized coffee farmers; and third, coffee farmers diversified into alternative crops. Non-coffee farmers seem to have benefited from the income generated through the coffee price boom. For the second halve of the 1990s, by contrast, it is impossible to discern any indirect effect of the fall in coffee prices from the data, which does, however, not necessarily indicate that there was none but may as well be due to the fact that other factors dominated the price change.

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Bibliographic Info

Paper provided by International Association of Agricultural Economists in its series 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia with number 25345.

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Date of creation: 2006
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Handle: RePEc:ags:iaae06:25345

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Keywords: Coffee Price Changes; Price Transmission; Rural Households; Poverty Analysis; Uganda; Consumer/Household Economics; Demand and Price Analysis;

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  1. 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.
  2. Ritva Reinikka & Paul Collier, 2001. "Uganda's Recovery : The Role of Farms, Firms, and Government," World Bank Publications, The World Bank, number 13850, February.
  3. Marcel Fafchamps & Ruth Vargas Hill & Aliziki Kaudha & Robert Waggwa Nsibirwa, 2003. "The transmission of international commodity prices to domestic producers," CSAE Working Paper Series 2003-14, Centre for the Study of African Economies, University of Oxford.
  4. Simon Appleton, 2003. "Regional or National Poverty Lines? The Case of Uganda in the 1990s," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 12(4), pages 598-624, December.
  5. Dorosh, Paul A. & El-Said, Moataz & Lofgren, Hans, 2003. "Technical Change, Market Incentives And Rural Incomes: A Cge Analysis Of Uganda'S Agriculture," 2003 Annual Meeting, August 16-22, 2003, Durban, South Africa 25846, International Association of Agricultural Economists.
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Cited by:
  1. Stephan Klasen & Jan Priebe & Robert Rudolf, 2013. "Cash crop choice and income dynamics in rural areas: evidence for post-crisis Indonesia," Agricultural Economics, International Association of Agricultural Economists, vol. 44(3), pages 349-364, 05.
  2. Murekezi, Abdoul Karim & Loveridge, Scott, 2009. "Have coffee reforms and coffee supply chains affected farmers' income? The case of coffee growers in Rwanda," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49597, Agricultural and Applied Economics Association.

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