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Burley Tobacco Clubs in Malawi: Nonmarket Institutions for Exports

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  • Negri, Mariano
  • Porto, Guido

Abstract

This paper studies nonmarket institutions that facilitate exports. In Malawi, as in many other developing countries, farmers face numerous constraints that disconnect them from export markets. We explore the role of a local institution, the burley tobacco clubs, in bridging smallholders to exports. Burley clubs potentially enable farmers to increase their tobacco farming productivity by providing services related to institutional access, collective action, economies of scale, and supporting networks. Using matching methods and instrumental variable techniques, we find that tobacco club membership causes an increase of between 40-74 percent in output per acre and an increase of between 45-89 percent in tobacco sales per acre. Instead, neither the land share allocated to tobacco nor the unit value obtained by the producers is affected by club membership.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 6210.

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Date of creation: Nov 2007
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Handle: RePEc:pra:mprapa:6210

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Keywords: institutional access; collective action and economies of scale; supporting networks; tobacco exports; trade facilitation;

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  2. Rose, Andrew K, 2003. "Which International Institutions Promote International Trade?," CEPR Discussion Papers, C.E.P.R. Discussion Papers 3764, C.E.P.R. Discussion Papers.
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Cited by:
  1. Hagen-Zanker, Jessica, 2010. "Modest expectations: Causes and effects of migration on migrant households in source countries," MPRA Paper 29507, University Library of Munich, Germany.
  2. Suzuki, Aya & Jarvis, Lovell S. & Sexton, Richard J., 2011. "Partial Vertical Integration, Risk Shifting, and Product Rejection in the High-Value Export Supply Chain: The Ghana Pineapple Sector," World Development, Elsevier, Elsevier, vol. 39(9), pages 1611-1623, September.
  3. Prowse, Martin, 2011. "A comparative value chain analysis of burley tobacco in Malawi - 2003/04 and 2009/10," IOB Working Papers 2011.09, Universiteit Antwerpen, Institute of Development Policy and Management (IOB).
  4. Wouter Zant, 2012. "How does Market Access affect Smallholder Behavior? The Case of Tobacco Marketing in Malawi," Tinbergen Institute Discussion Papers 12-088/V, Tinbergen Institute, revised 25 Aug 2014.

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