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Market Structure and Coherence of International Cooperation: The Case of the Dairy Sector in Malawi


  • Revoredo-Giha, Cesar


Abstract A supply chain in disarray can be identified as a barrier not only to growth for the agricultural sector but also to achieving food security in a country because it may lead to either a deficiency in food production and/or too high prices. Using the dairy sector of Malawi as an example, the purpose of this paper is to discuss the coherence between market structure and the development strategy pursued by international donors. Within Malawi the dairy sector may be characterised as a segmented market: with both formal and informal milk markets, with smallholder producers serving both markets. The formal market includes few processing firms operating with idle capacity and selling dairy products to an affluent segment of the urban population, whilst the informal market comprises the sale of unprocessed milk products to the less affluent urban population and also rural areas. In this context, cooperative international action, conducted through agencies from a range of countries, is targeted at improving the efficiency of the formal supply chain and also the creation of local supply chains that sell processed products directly to poor consumers. The paper discusses reasons why these two cooperation strategies, given the structure of the sector, may potentially conflict with each other, the need to address the degree of market imperfection of the formal sector and the desirability of ex-ante coordination of plans amongst donors.
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  • Revoredo-Giha, Cesar, 2012. "Market Structure and Coherence of International Cooperation: The Case of the Dairy Sector in Malawi," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 125274, International Association of Agricultural Economists.
  • Handle: RePEc:ags:iaae12:125274

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    References listed on IDEAS

    1. Revoredo-Giha, Cesar & Arakelyan, Irina & Chalmers, Neil, 2015. "Processors pricing and smallholders’ milk supply response in Malawi: An application of the nonlinear autoregressive distributed lag model," 2015 Conference, August 9-14, 2015, Milan, Italy 212295, International Association of Agricultural Economists.
    2. Gow, Hamish R & Swinnen, Johan F M, 1998. "Up- and Downstream Restructuring, Foreign Direct Investment, and Hold-Up Problems in Agricultural Transition," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 25(3), pages 331-350.
    3. A. M. Azzam & E. Pagoulatos, 1990. "Testing Oligopolistic And Oligopsonistic Behaviour: An Application To The Us Meat-Packing Industry," Journal of Agricultural Economics, Wiley Blackwell, vol. 41(3), pages 362-370.
    4. Schroeter, John R, 1988. "Estimating the Degree of Market Power in the Beef Packing Industry," The Review of Economics and Statistics, MIT Press, vol. 70(1), pages 158-162, February.
    5. Mingxia Zhang, 1997. "The Effects of Imperfect Competition on the Size and Distribution of Research Benefits," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(4), pages 1252-1265.
    6. Gorton, Matthew & Dumitrashko, Mikhail & White, John, 2006. "Overcoming supply chain failure in the agri-food sector: A case study from Moldova," Food Policy, Elsevier, vol. 31(1), pages 90-103, February.
    7. Ecker, Olivier & Qaim, Matin, 2011. "Analyzing Nutritional Impacts of Policies: An Empirical Study for Malawi," World Development, Elsevier, vol. 39(3), pages 412-428, March.
    8. Winston, Gordon C, 1974. "The Theory of Capital Utilization and Idleness," Journal of Economic Literature, American Economic Association, vol. 12(4), pages 1301-1320, December.
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    1. repec:spr:agfoec:v:5:y:2017:i:1:d:10.1186_s40100-017-0091-z is not listed on IDEAS
    2. Revoredo-Giha, Cesar & Toma, Luiza, 2016. "Assessing the development strategies for the Malawian dairy sector: A spatial multimarket model," 2016 AAAE Fifth International Conference, September 23-26, 2016, Addis Ababa, Ethiopia 246958, African Association of Agricultural Economists (AAAE).
    3. Revoredo-Giha, Cesar & Arakelyan, Irina & Chalmers, Neil & Chitika, Rollins, 2013. "How Responsive to Prices is the Supply of Milk in Malawi?," 2013 AAAE Fourth International Conference, September 22-25, 2013, Hammamet, Tunisia 160590, African Association of Agricultural Economists (AAAE).
    4. Chalmers, Neil George & Revoredo-Giha, Cesar & Jumbe, Charles, 2015. "Measuring the Degree of Integration on the Dairy Products Market in Malawi," 89th Annual Conference, April 13-15, 2015, Warwick University, Coventry, UK 204286, Agricultural Economics Society.


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