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Optimal export taxes – the case of cocoa in Cote d'Ivoire

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  • Burger, Kees

Abstract

Export taxes can provide additional welfare to large exporters, an argument for interventions in many primary commodity exporting countries. We investigate the benefits of export taxation for Côte d'Ivoire, the dominant exporter of cocoa. Where many applications treat the formula for optimal export taxes incorrectly as a prescription, we take the endogeneity of the exporter’s share into account. We also distinguish between short-term and long-term effects, relevant for a tree crop like cocoa and we allow for a normal commercial margin between export and farm gate prices. Results are calculated via simulations in a model, in which the age-compositions of the tree stocks of major producing countries are distinguished. Simulations over a period of 15 years show that higher levels of export taxation do not change overall revenues of Côte d'Ivoire on a longer term, but lead to strong redistribution from farmers to the central authorities.

Suggested Citation

  • Burger, Kees, 2008. "Optimal export taxes – the case of cocoa in Cote d'Ivoire," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6395, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaa107:6395
    DOI: 10.22004/ag.econ.6395
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    References listed on IDEAS

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    1. Christopher L. Gilbert & Panos Varangis, 2003. "Globalization and International Commodity Trade with Specific Reference to the West African Cocoa Producers," NBER Working Papers 9668, National Bureau of Economic Research, Inc.
    2. Takamasa Akiyama, 1992. "Is there a case for an optimal export tax on perennial crops?," Policy Research Working Paper Series 854, The World Bank.
    3. Yilmaz, Kamil, 1999. "Optimal export taxes in a multicountry framework," Journal of Development Economics, Elsevier, vol. 60(2), pages 439-465, December.
    4. Peter G. Warr, 2001. "Welfare Effects of an Export Tax: Thailand's Rice Premium," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(4), pages 903-920.
    5. Irwin, Douglas A., 2003. "The optimal tax on antebellum US cotton exports," Journal of International Economics, Elsevier, vol. 60(2), pages 275-291, August.
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    Cited by:

    1. Fofana, Ismaël & Badiane, Ousmane & Camara, Alhassane & Goundan, Anatole, 2018. "Groundnut export tax in Senegal: Winners and losers," IFPRI discussion papers 1757, International Food Policy Research Institute (IFPRI).
    2. Amzul Rifin, 2015. "The Impact of Export Tax Policy on Cocoa Farmers and Supply Chain," The International Trade Journal, Taylor & Francis Journals, vol. 29(1), pages 39-62, March.
    3. Permani, Risti, 2013. "Optimal Export Tax Rates of Cocoa Beans: A Vector Error Correction Model Approach," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 57(4), pages 1-22.
    4. Rifin, Amzul & Nauly, Dahlia, 2013. "The Effect of Export Tax on Indonesia’s Cocoa Export Competitiveness," 2013 Conference (57th), February 5-8, 2013, Sydney, Australia 152175, Australian Agricultural and Resource Economics Society.

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