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The impact of alternative input subsidy exit strategies on Malawi’s maize commodity market:

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  • Mapila, Mariam A. T. J.
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    Abstract

    This study has been conducted in order to generate evidence of the visibility of exit from farm input subsidies in an African context. The study simulates the impact of alternative exit strategies from Malawi’s farm input subsidy program on maize markets. The simulation is conducted using a multiequation partial equilibrium model of the national maize market, which is sequentially linked via a price-linkage equation to local rural maize markets. The model accounts for market imperfections prevailing in the country that arise from government price interventions. Findings show that some alternative exit strategies have negative and sustained impacts on maize yields, production, and acreage allocated to maize over the simulation period. Market prices rise steadily as a result of the implementation of different exit strategies. Despite higher maize prices, domestic maize consumption remains fairly stable, with a slow but increasing trend over the simulation period.

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    Bibliographic Info

    Paper provided by International Food Policy Research Institute (IFPRI) in its series IFPRI discussion papers with number 1278.

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    Date of creation: 2013
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    Handle: RePEc:fpr:ifprid:1278

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    Related research

    Keywords: fertilizer subsidies; farm input allocation; subsidy reform; partial equilibrium model; Agricultural policies; maize;

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    1. Gallagher, Paul W., 1978. "The Effectiveness Of Price Support Policy--Some Evidence For U.S. Corn Acreage Response," Staff Papers 14140, University of Minnesota, Department of Applied Economics.
    2. Michael Morris & Valerie A. Kelly & Ron J. Kopicki & Derek Byerlee, 2007. "Fertilizer Use in African Agriculture : Lessons Learned and Good Practice Guidelines," World Bank Publications, The World Bank, number 6650, October.
    3. Gallagher, Paul W., 1978. "The Effectiveness of Price Support Policy--Some Evidence for U.S. Corn Acreage Response," Staff General Research Papers 12561, Iowa State University, Department of Economics.
    4. Gallagher, Paul, 1978. "The Effectiveness Of Price Support Policy-Some Evidence For U.S. Corn Acreage Response," Agricultural Economics Research, United States Department of Agriculture, Economic Research Service, issue 4.
    5. Jacob Ricker-Gilbert & Thomas S. Jayne & Ephraim Chirwa, 2010. "Subsidies and Crowding Out: A Double-Hurdle Model of Fertilizer Demand in Malawi," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 93(1), pages 26-42.
    6. Jayne, Thomas S. & Mason, Nicole M. & Myers, Robert J. & Ferris, John N. & Mather, David & Beaver, Margaret & Lenski, Natalie & Chapoto, Antony & Boughton, Duncan, 2010. "Patterns and Trends in Food Staples Markets in Eastern and Southern Africa: Toward the Identification of Priority Investments and Strategies for Developing Markets and Promoting Smallholder Productivi," Food Security International Development Working Papers 62148, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    7. Chibwana, Christopher & Fisher, Monica & Shively, Gerald, 2012. "Cropland Allocation Effects of Agricultural Input Subsidies in Malawi," World Development, Elsevier, vol. 40(1), pages 124-133.
    8. Mapila, Mariam A. T. J. & Kirsten, Johann F. & Meyer, Ferdinand & Kankwamba, Henry, 2013. "A partial equilibrium model of the Malawi maize commodity market:," IFPRI discussion papers 1254, International Food Policy Research Institute (IFPRI).
    9. Gladwin, Christina H., 1992. "Gendered impacts of fertilizer subsidy removal programs in Malawi and Cameroon," Agricultural Economics, Blackwell, vol. 7(2), pages 141-153, July.
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