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Price Incentives, Non-Price Factors, and Agricultural Production in Sub-Saharan Africa: A Cointegration Analysis

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  • Rainer Thiele

Abstract

This paper deals with the question of how responsive farmers in Sub-Saharan Africa (SSA) are to changes in incentives. Employing Johansen's multivariate cointegration approach, it investigates for ten selected SSA countries the long-run effect of pricing policies, macroeconomic distortions, and certain non-price factors on agricultural production. It turns out that – in those cases where cointegration relationships are found-estimated supply elasticities tend to lie between 0.20 and 0.50. Among the non-price factors, drought episodes have significantly impaired agricultural growth in six out of ten sample countries.

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File URL: https://www.ifw-members.ifw-kiel.de/publications/price-incentives-non-price-factors-and-agricultural-production-in-sub-saharan-africa-a-cointegration-analysis/kap1123.pdf
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Bibliographic Info

Paper provided by Kiel Institute for the World Economy in its series Kiel Working Papers with number 1123.

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Length: 26 pages
Date of creation: Jul 2002
Date of revision:
Handle: RePEc:kie:kieliw:1123

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Keywords: Agricultural Supply Response; Cointegration; Sub-Saharan Africa;

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References

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  1. Rainer Thiele, 2002. "The Bias Against Agriculture in Sub-Saharan Africa: Has It Survived 20 Years of Structural Adjustment Programs?," Kiel Working Papers, Kiel Institute for the World Economy 1102, Kiel Institute for the World Economy.
  2. David E. Rapach, 2002. "Are Real GDP Levels Nonstationary? Evidence from Panel Data Tests," Southern Economic Journal, Southern Economic Association, Southern Economic Association, vol. 68(3), pages 473-495, January.
  3. Jeroen J.M. Kremers & Neil R. Ericsson & Juan J. Dolado, 1992. "The power of cointegration tests," International Finance Discussion Papers, Board of Governors of the Federal Reserve System (U.S.) 431, Board of Governors of the Federal Reserve System (U.S.).
  4. Schiff, Maurice & Montenegro, Claudio E., 1995. "Aggregate agricultural supply response in developing countries : a survey of selected issues," Policy Research Working Paper Series, The World Bank 1485, The World Bank.
  5. Johansen, Soren, 1988. "Statistical analysis of cointegration vectors," Journal of Economic Dynamics and Control, Elsevier, Elsevier, vol. 12(2-3), pages 231-254.
  6. Peter C.B. Phillips & Pierre Perron, 1986. "Testing for a Unit Root in Time Series Regression," Cowles Foundation Discussion Papers, Cowles Foundation for Research in Economics, Yale University 795R, Cowles Foundation for Research in Economics, Yale University, revised Sep 1987.
  7. Rainer Thiele, 2000. "Estimating the Aggregate Agricultural Supply Response: A Survey of Techniques and Results for Developing Countries," Kiel Working Papers, Kiel Institute for the World Economy 1016, Kiel Institute for the World Economy.
  8. Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, Econometric Society, vol. 55(2), pages 251-76, March.
  9. Mamingi, Nlandu, 1997. "The impact of prices and macroeconomic policies on agricultural supply: a synthesis of available results," Agricultural Economics, Blackwell, Blackwell, vol. 16(1), pages 17-34, March.
  10. R. L. Voortman & B. G. J. S. Sonneveld & M. A. Keyzer, 2000. "African Land Ecology: Opportunities and Constraints for Agricultural Development," CID Working Papers, Center for International Development at Harvard University 37, Center for International Development at Harvard University.
  11. Mamingi, Nlandu, 1997. "The impact of prices and macroeconomic policies on agricultural supply: a synthesis of available results," Agricultural Economics: The Journal of the International Association of Agricultural Economists, International Association of Agricultural Economists, International Association of Agricultural Economists, vol. 16(1), March.
  12. Andrew McKay & Oliver Morrissey & Charlotte Vaillant, 1999. "Aggregate supply response in Tanzanian agriculture," The Journal of International Trade & Economic Development, Taylor & Francis Journals, Taylor & Francis Journals, vol. 8(1), pages 107-123.
  13. Marc Nerlove, 1979. "The Dynamics of Supply: Retrospect and Prospect," Discussion Papers, Northwestern University, Center for Mathematical Studies in Economics and Management Science 394, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
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Cited by:
  1. Olubode-Awosola, O.O. & van Schalkwyk, H.D. & Jooste, A., 2008. "Mathematical modeling of the South African land redistribution for development policy," Journal of Policy Modeling, Elsevier, Elsevier, vol. 30(5), pages 841-855.
  2. Caracciolo, Francesco & Santeramo, Fabio Gaetano, 2012. "Price trends and income inequalities: will Sub-Saharan-Africa reduce the gap?," MPRA Paper 45196, University Library of Munich, Germany.
  3. Johnson, Michael E. & Takeshima, Hiroyuki & Gyimah-Brempong, Kwabena, 2013. "Assessing the potential and policy alternatives for achieving rice competitiveness and growth in Nigeria:," IFPRI discussion papers, International Food Policy Research Institute (IFPRI) 1301, International Food Policy Research Institute (IFPRI).
  4. Olubode-Awosola, O.O. & Oyewumi, Olubukola Ayodeju & Jooste, Andre, 2006. "Vector error correction modelling of Nigerian agricultural supply response," Agrekon, Agricultural Economics Association of South Africa (AEASA), Agricultural Economics Association of South Africa (AEASA), vol. 45(4), December.
  5. Luis Lanteri, 2009. "Response of the Argentine Soybean Sown Area to Prices," BCRA Working Paper Series 200944, Central Bank of Argentina, Economic Research Department.

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