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Realizing the gains from trade : export crops, marketing costs, and poverty

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  • Balat, Jorge
  • Brambilla, Irene
  • Porto, Guido

Abstract

This paper explores the role of export costs in the process of poverty reduction in rural Africa. The authors claim that the marketing costs that emerge when the commercialization of export crops requires intermediaries can lead to lower participation into export cropping and, thus, to higher poverty. They test the model using data from the Uganda National Household Survey. The findings show that: i) farmers living in villages with fewer outlets for sales of agricultural exports are likely to be poorer than farmers residing in marketendowed villages; ii) market availability leads to increased household participation in export cropping (coffee, tea, cotton, fruits); and iii) households engaged in export cropping are less likely to be poor than subsistence-based households. The authors conclude that the availability of markets for agricultural export crops helps realize the gains from trade. This result uncovers the role of complementary factors that provide market access and reduce marketing costs as key building blocks in the link between the gains from export opportunities and the poor.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4488.

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Date of creation: 01 Jan 2008
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Handle: RePEc:wbk:wbrwps:4488

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Keywords: Transport Economics Policy&Planning; Markets and Market Access; Rural Poverty Reduction; Crops&Crop Management Systems;

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Citations

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Cited by:
  1. Jorge Balat & Irene Brambilla & Guido Porto, 2007. "Realizing the Gains From Trade: Export Crops, Marketing Costs, and Poverty," NBER Working Papers 13395, National Bureau of Economic Research, Inc.
  2. Luis Carvalho & Aurora A.C. Teixeira, 2011. "Where are the poor in International Economics?," FEP Working Papers 425, Universidade do Porto, Faculdade de Economia do Porto.
  3. Isabelle Bensidoun & Sébastien Jean & Aude Sztulman, 2011. "International trade and income distribution: reconsidering the evidence," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 147(4), pages 593-619, November.
  4. Raballand, Gael & Macchi, Patricia & Merotto, Dino & Petracco, Carly, 2009. "Revising the roads investment strategy in rural areas : an application for Uganda," Policy Research Working Paper Series 5036, The World Bank.
  5. Erhan Artuç & Germán Bet & Irene Brambilla & Guido Porto, 2013. "Trade Shocks and Factor Adjustment Frictions: Implications for Investment and Labor," Department of Economics, Working Papers 101, Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata.
  6. Shepherd, Ben & Delpeuch, Claire, 2007. "Subsidies and regulatory reform in West African cotton: What are the development stakes?," MPRA Paper 2289, University Library of Munich, Germany.
  7. Cadot, Olivier & Fernandes, Ana M. & Gourdon, Julien & Mattoo, Aaditya, 2011. "Impact evaluation of trade interventions : paving the way," Policy Research Working Paper Series 5877, The World Bank.
  8. Kuhlgatz, Christian & Abdulai, Awudu, 2011. "Determinants and Welfare Impacts of Export Crop Cultivation - Empirical Evidence from Ghana," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114692, European Association of Agricultural Economists.
  9. World Bank, 2010. "Uganda - Public Expenditure Review : Strengthening the Impact of the Roads Budget," World Bank Other Operational Studies 2941, The World Bank.

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