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The economics of food aid under subsistence farming with an application to Malawi

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  • Zant, Wouter

Abstract

We investigate how food-aid affects price and production of staple food, with a partial equilibrium model with non-separable production and consumption. The model captures the key characteristics of sub-Saharan Africa subsistence economies. Simulations generate negative but also positive food-aid elasticities of production. Conditions are identified which mitigate the negative impact and support a positive impact. The share of domestic food production in total staple food demand (+) and the share of income from staple food production in total household income (−) are key determinants. Price and production equations, estimated with a panel of district data of the Malawi maize market for the period 1999–2010, show a small positive impact of food-aid. Large negative impacts of food-aid are not likely given production and income shares and behavioural responses.

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  • Zant, Wouter, 2012. "The economics of food aid under subsistence farming with an application to Malawi," Food Policy, Elsevier, vol. 37(1), pages 124-141.
  • Handle: RePEc:eee:jfpoli:v:37:y:2012:i:1:p:124-141
    DOI: 10.1016/j.foodpol.2011.09.004
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    Cited by:

    1. Wouter Zant, 2018. "Trains, Trade, and Transaction Costs: How Does Domestic Trade by Rail Affect Market Prices of Malawi Agricultural Commodities?," World Bank Economic Review, World Bank Group, vol. 32(2), pages 334-356.
    2. Wouter Zant, 2020. "How Costly is using Livestock as a Saving Device? A Note on Meat Prices during Food Shortages," Tinbergen Institute Discussion Papers 20-021/V, Tinbergen Institute, revised 31 Jun 2020.
    3. Thomas Ferreira, 2018. "Does education enhance productivity in smallholder agriculture? Causal evidence from Malawi," Working Papers 05/2018, Stellenbosch University, Department of Economics.
    4. Tschirley, David & Myers, Robert & Zavale, Helder, 2014. "MSU/FSG Study of the Impact of WFP Local and Regional Food Aid Procurement on Markets, Households, and Food Value Chains," Food Security International Development Working Papers 184835, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    5. De Matteis, Alessandro & Ellis, Frank & Valdes, Ivan, 2017. "The relevance of market prices for the design of transfer programs in response to food insecurity," The Quarterly Review of Economics and Finance, Elsevier, vol. 66(C), pages 202-211.
    6. Wouter Zant, 2012. "Is EU Support to Malawi Agriculture Effective?," Tinbergen Institute Discussion Papers 12-090/V, Tinbergen Institute.
    7. 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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