EXECUTIVE SUMMARY In Africa since 1980, more than 30 countries have undertaken agricultural policy reforms as part of broader structural adjustment programs. Many advocates of market reform have argued that the relaxation of controls on private trade and investment would raise productivity based on the premises that (1) liberalized input and output markets would increase farm profitability by increasing average output prices and reducing input costs, thereby spurring farm investments and commercialization; and (2) farm investment and commercialization would lead to dynamic changes throughout the economy to support structural transformation. However, the results of the reform programs have been mixed and frequently inconsistent with the expected increases in productivity. Using national-level data from Burkina Faso, Ethiopia, Kenya, Mali, Senegal, Zambia, and Zimbabwe, we found that partial measures of agricultural labor productivity increased during the periods of sectoral reform in only three of seven cases; partial measures of agricultural land productivity increased in four of seven cases. These findings are consistent with micro-level research findings indicating that in spite of major benefits achieved through the elimination of former policy-related barriers to private investment in the food system, there remain major institutional constraints in the prevailing economic-legal-contractual systems of exchange that retard the potential for future development. It is now being realized that the sectoral reform prescriptions have, in many cases, been based upon only superficial knowledge of the prevailing economic institutions and how they affect economic outcomes in particular economies. There is also an emerging general consensus that future productivity growth within the evolving market economies in Africa will require closer attention to the institutional details of the system  i.e., going beyond generalizations that property rights, market rules, and exchange mechanisms need to be defined and worked out, to actually conducting pragmatic applied research on the specific kinds of property rights, rules, and exchange arrangements that would most contribute to economic development under particular country circumstances. This implies a need for procedures of identifying and working out specific property rights, commercial codes, market rules, and exchange arrangements most likely to contribute to improved economic performance, given the values of people and circumstances of the country. This paper reviews the emerging empirical record of agricultural marketing policy reform and agricultural productivity, drawing from research on food access and agricultural productivity supported by USAIDÂs Africa Bureau on seven countries in West, Eastern, and Southern Africa. We also examine key factors constraining past and future performance of the food systems in these countries. The paper concludes by identifying a set of policy issues for further consideration that would help provide the investment incentives to promote productivity growth for the millions of low-input semi-subsistence rural households in the region.
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Paper provided by Michigan State University, Department of Agricultural, Food, and Resource Economics in its series Food Security III Papers with number
11436.
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