IDEAS home Printed from https://ideas.repec.org/a/eee/indorg/v104y2026ics0167718725001006.html

The effectiveness of ’in-market’ and ’out-of-market’ liberalization policies. Evidence from Indian produce markets

Author

Listed:
  • Itin-Shwartz, Beáta

Abstract

Do market liberalization policies result in more efficient markets, increase competition and change market outcomes for the trading parties? In this paper I examine two types of liberalization policies, those aimed at increasing competition and efficiency within the existing regulated market, and those allowing competing channels outside of the regulated system. Studying a marketing channel reform in Indian agricultural produce markets, which consisted of both ‘in-market amendments’ and ‘out-of- market amendments’ adopted in different combinations and timing by the Indian states, I evaluate the effectiveness of the reforms in improving the bargaining power of farmers vis-a-vis the licensed traders in the regulated markets. I find an average 3 % overall increase in prices obtained by farmers following the reform in total, and 12 % for storable crops. While apparently much harder to pass, in-market reforms appears to be driving most of the change while the effect for out-of-market reforms is mostly insignificant.

Suggested Citation

  • Itin-Shwartz, Beáta, 2026. "The effectiveness of ’in-market’ and ’out-of-market’ liberalization policies. Evidence from Indian produce markets," International Journal of Industrial Organization, Elsevier, vol. 104(C).
    • Handle: RePEc:eee:indorg:v:104:y:2026:i:c:s0167718725001006
    DOI: 10.1016/j.ijindorg.2025.103234
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0167718725001006
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ijindorg.2025.103234?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Shoumitro Chatterjee, 2023. "Market Power and Spatial Competition in Rural India," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 138(3), pages 1649-1711.
    2. Rodrik, Dani, 2004. "Industrial Policy for the Twenty-First Century," Working Paper Series rwp04-047, Harvard University, John F. Kennedy School of Government.
    3. Giuliano Paola & Scalise Diego, 2009. "The Political Economy of Agricultural Market Reforms in Developing Countries," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 9(1), pages 1-27, August.
    4. Jayne, T. S. & Govereh, J. & Mwanaumo, A. & Nyoro, J. K. & Chapoto, A., 2002. "False Promise or False Premise? The Experience of Food and Input Market Reform in Eastern and Southern Africa," World Development, Elsevier, vol. 30(11), pages 1967-1985, November.
    5. Kirill Borusyak & Xavier Jaravel & Jann Spiess, 2024. "Revisiting Event-Study Designs: Robust and Efficient Estimation," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 91(6), pages 3253-3285.
    6. Catherine A. Durham & Richard J. Sexton, 1992. "Oligopsony Potential in Agriculture: Residual Supply Estimation in California's Processing Tomato Market," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 74(4), pages 962-972.
    7. Christine Moser & Christopher Barrett & Bart Minten, 2009. "Spatial integration at multiple scales: rice markets in Madagascar," Agricultural Economics, International Association of Agricultural Economists, vol. 40(3), pages 281-294, May.
    8. Forhad Shilpi & Dina Umali‐Deininger, 2008. "Market facilities and agricultural marketing: evidence from Tamil Nadu, India," Agricultural Economics, International Association of Agricultural Economists, vol. 39(3), pages 281-294, November.
    9. Baker, Andrew C. & Larcker, David F. & Wang, Charles C.Y., 2022. "How much should we trust staggered difference-in-differences estimates?," Journal of Financial Economics, Elsevier, vol. 144(2), pages 370-395.
    10. Bart Minten & David Stifel & Seneshaw Tamru, 2014. "Structural Transformation of Cereal Markets in Ethiopia," Journal of Development Studies, Taylor & Francis Journals, vol. 50(5), pages 611-629, May.
    11. Stephen G. Donald & Kevin Lang, 2007. "Inference with Difference-in-Differences and Other Panel Data," The Review of Economics and Statistics, MIT Press, vol. 89(2), pages 221-233, May.
    12. Myers, Robert J., 2013. "Evaluating the effectiveness of inter-regional trade and storage in Malawi’s private sector maize markets," Food Policy, Elsevier, vol. 41(C), pages 75-84.
    13. Jonathan Kydd & Andrew Dorward, 2001. "The Washington Consensus on Poor Country Agriculture: Analysis, Prescription and Institutional Gaps," Development Policy Review, Overseas Development Institute, vol. 19(4), pages 467-478, December.
    14. Mangala, K.P. & Chengappa, P.G., 2008. "A novel agribusiness model for backward linkages with farmers: a case of food retail chain," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 21(Conferenc).
    15. Emílio Tostão & B. Wade Brorsen, 2005. "Spatial price efficiency in Mozambique's post‐reform maize markets," Agricultural Economics, International Association of Agricultural Economists, vol. 33(2), pages 205-214, September.
    16. Brian Dillon & Chelsey Dambro, 2017. "How Competitive Are Crop Markets in Sub-Saharan Africa?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 99(5), pages 1344-1361.
    17. Muto, Megumi & Yamano, Takashi, 2009. "The Impact of Mobile Phone Coverage Expansion on Market Participation: Panel Data Evidence from Uganda," World Development, Elsevier, vol. 37(12), pages 1887-1896, December.
    18. Pritam Singh & Shruti Bhogal, 2021. "Interrogating the MSP Regime, Farm Laws and Agrarian Future in India," Millennial Asia, , vol. 12(3), pages 332-349, December.
    19. Abdulai, Awudu, 2000. "Spatial price transmission and asymmetry in the Ghanaian maize market," Journal of Development Economics, Elsevier, vol. 63(2), pages 327-349, December.
    20. Badiane, Ousmane & Shively, Gerald E., 1998. "Spatial integration, transport costs, and the response of local prices to policy changes in Ghana," Journal of Development Economics, Elsevier, vol. 56(2), pages 411-431, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Brian Dillon & Chelsey Dambro, 2017. "How Competitive Are Crop Markets in Sub-Saharan Africa?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 99(5), pages 1344-1361.
    2. repec:ags:ijag24:346854 is not listed on IDEAS
    3. Kabbiri, Ronald & Dora, Manoj & Elepu, Gabriel & Gellynck, Xavier, 2016. "A Global Perspective of Food Market Integration: A Review," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 55(01-2), May.
    4. Hailemariam Ayalew & Dagim G. Belay, 2020. "The Ethiopian Commodity Exchange and Spatial Price Dispersion: Disentangling Warehouse and Price Information effects," IFRO Working Paper 2020/01, University of Copenhagen, Department of Food and Resource Economics.
    5. Guillaume Pierre & Jonathan Kaminski, 2019. "Cross country maize market linkages in Africa: integration and price transmission across local and global markets," Agricultural Economics, International Association of Agricultural Economists, vol. 50(1), pages 79-90, January.
    6. Pallavi Rajkhowa & Heike Baumüller, 2024. "Assessing the potential of ICT to increase land and labour productivity in agriculture: Global and regional perspectives," Journal of Agricultural Economics, Wiley Blackwell, vol. 75(2), pages 477-503, June.
    7. Wouter Zant, 2013. "How Is the Liberalization of Food Markets Progressing? Market Integration and Transaction Costs in Subsistence Economies," The World Bank Economic Review, World Bank, vol. 27(1), pages 28-54.
    8. Jin Guo & Tetsuji Tanaka, 2019. "Determinants of international price volatility transmissions: the role of self-sufficiency rates in wheat-importing countries," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 5(1), pages 1-13, December.
    9. Sitko, Nicholas J. & Jayne, T.S., 2014. "Exploitative Briefcase Businessmen, Parasites, and Other Myths and Legends: Assembly Traders and the Performance of Maize Markets in Eastern and Southern Africa," World Development, Elsevier, vol. 54(C), pages 56-67.
    10. Huang, Xuhui & Zhou, Tao & Zhang, Ning, 2025. "How does the carbon market influence the marginal abatement cost? Evidence from China's coal-fired power plants," Applied Energy, Elsevier, vol. 378(PA).
    11. Zant, Wouter, 2023. "Mobile Phones and Mozambique Traders: Size, Composition and Distribution of Reduced Transaction Costs," Food Policy, Elsevier, vol. 116(C).
    12. Ankamah-Yeboah, Isaac, 2012. "Spatial Price Transmission in the Regional Maize Markets in Ghana," MPRA Paper 49720, University Library of Munich, Germany.
    13. Isaac Abunyuwah, 2020. "Modeling Market Integration and Asymmetric Price Transmission Dynamics of Yam Markets in Ghana," Journal of Economics and Behavioral Studies, AMH International, vol. 12(3), pages 23-31.
    14. Wang, Yimin, 2025. "Links between COVID-19 lockdowns and drug overdose deaths, evidence from panel data," Economics & Human Biology, Elsevier, vol. 58(C).
    15. Shipeng Yan & Wei Jiang & Yue Xu, 2026. "Global investors, hidden suppliers: how institutions shape the impact of stock market liberalization programs on corporate responsibility," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 57(2), pages 197-219, March.
    16. Guo, Shijun & Hu, Fang, 2025. "Catalyzing transparency: Proactive enforcement of information disclosure and its impact on stock price synchronicity," Journal of Contemporary Accounting and Economics, Elsevier, vol. 21(1).
    17. Brenton, Paul & Portugal-Perez, Alberto & Regolo, Julie, 2014. "Food prices, road infrastructure, and market integration in Central and Eastern Africa," Policy Research Working Paper Series 7003, The World Bank.
    18. Svanidze, Miranda & Götz, Linde & Djuric, Ivan & Glauben, Thomas, 2019. "Food security and the functioning of wheat markets in Eurasia: a comparative price transmission analysis for the countries of Central Asia and the South Caucasus," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 11(3), pages 733-752.
    19. Li, Ping & Wang, Yujing & Li, Meng & Gao, Haoyu, 2024. "The power of speed: High-speed railways and scientific research competitiveness in China," Journal of Asian Economics, Elsevier, vol. 95(C).
    20. Wan, Liyang & Wan, Qian & Yang, Zichao & Zhao, Ying, 2026. "Judicial institution and innovation: Evidence from China's intellectual property courts reform," Journal of Development Economics, Elsevier, vol. 179(C).
    21. Jin Guo & Tetsuji Tanaka, 2020. "Examining the determinants of global and local price passthrough in cereal markets: evidence from DCC-GJR-GARCH and panel analyses," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 8(1), pages 1-22, December.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:indorg:v:104:y:2026:i:c:s0167718725001006. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/505551 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.