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Distortions to Agricultural Incentives in Nigeria

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  • Walkenhorst, Peter

Abstract

Agricultural policy makers need detailed information on the effectiveness of past policies, in order to increase the efficiency of government interventions to foster agricultural development and poverty reduction. The indicators of policy distortions reported in this study aim to contribute to a better understanding of the direction and magnitude to which policy instruments have affected incentives that agricultural producers and food consumers in Nigeria have faced over the past 50 years. In particular, the distortion indicators attempt to measure the divergence between the price actually paid to the agricultural producer and the price that the farmer would have received in a distortion-free policy environment. The findings indicate that Nigeria’s policies towards agricultural producers have shifted significantly over time, with agricultural producer support first declining after the country’s independence, then increasing again between the mid-1970s and the mid-1980s, and afterwards moving towards an incentive-neutral stance. The sectoral averages hide large support differences across commodities though. Export commodities have consistently been explicitly or implicitly taxed, while import-competing commodities have benefitted from producer support through tariff and non-tariff barriers and, to a lesser extent, budgetary payments. In this context, recent policy reforms towards greater regional and global trade integration promise to remove the remaining anti-trade bias and provide producers with a more market-friendly policy environment.

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Bibliographic Info

Paper provided by World Bank in its series Agricultural Distortions Working Paper with number 48513.

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Date of creation: Dec 2007
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Handle: RePEc:ags:wbadwp:48513

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Web page: http://www.worldbank.org
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Related research

Keywords: Distorted incentives; agricultural and trade policy reforms; national agricultural development; Agricultural and Food Policy; International Relations/Trade; F13; F14; Q17; Q18;

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References

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  1. Oyejide, T. Ademola., 1986. "The effects of trade and exchange rate policies on agriculture in Nigeria.:," Research reports 55, International Food Policy Research Institute (IFPRI).
  2. Pinto, Brian, 1987. "Nigeria during and after the Oil Boom: A Policy Comparison with Indonesia," World Bank Economic Review, World Bank Group, vol. 1(3), pages 419-45, May.
  3. Anderson, Kym & Kurzweil, Marianne & Martin, Will & Sandri, Damiano & Valenzuela, Ernesto, 2008. "Measuring Distortions to Agricultural Incentives, Revisited," CEPR Discussion Papers 6924, C.E.P.R. Discussion Papers.
  4. Anderson, Kym & Kurzweil, Marianne & Martin, William J. & Sandri, Damiano & Valenzuela, Ernesto, 2008. "Methodology for Measuring Distortions to Agricultural Incentives," Agricultural Distortions Working Paper 48326, World Bank.
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Cited by:
  1. Valenzuela, Ernesto & Kurzweil, Marianne & Croser, Johanna L. & Nelgen, Signe & Anderson, Kym, 2007. "Annual Estimates Of African Distortions To Agricultural Incentives," Agricultural Distortions Working Paper 48553, World Bank.
  2. Anderson, Kym & Masters, William A., 2008. "Distortions to Agricultural Incentives in Sub-Saharan and North Africa," Agricultural Distortions Working Paper 48572, World Bank.
  3. Onipede Liverpool, Lenis Saweda & Ayoola, Gbolagade B. & Oyeleke, Razaq O., 2009. "Enhancing the competitiveness of agricultural commodity chains in Nigeria: Identifying opportunities with cassava, rice, and maize using a Policy Analysis Matrix (PAM) framework," NSSP working papers 13, International Food Policy Research Institute (IFPRI).
  4. Kym Anderson & William A. Masters, 2009. "Distortions to Agricultural Incentives in Africa," World Bank Publications, The World Bank, number 2607, October.
  5. World Bank, 2008. "Nigeria - Agriculture Public Expenditure Review," World Bank Other Operational Studies 7923, The World Bank.

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