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The Economywide Impacts and Risks of Malawi's Farm Input Subsidy Programme

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  • Channing Arndt
  • Karl Pauw
  • James Thurlow

Abstract

We estimate the impact of Malawi's Farm Input Subsidy Programme using an economywide approach. We find potentially substantial net benefits with indirect benefits accounting for about two-fifths of total benefits. Due to these indirect benefits, the cut-off at which lower fertilizer yield response rates lead to net programme losses is much lower than the value suggested by existing partial equilibrium evaluations. Benefits decline with domestic financing and real fertilizer price increases.

Suggested Citation

  • Channing Arndt & Karl Pauw & James Thurlow, 2014. "The Economywide Impacts and Risks of Malawi's Farm Input Subsidy Programme," WIDER Working Paper Series wp-2014-099, World Institute for Development Economic Research (UNU-WIDER).
  • Handle: RePEc:unu:wpaper:wp-2014-099
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    More about this item

    Keywords

    Agriculture; Food supply;

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O22 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Project Analysis
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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