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The impact of farm input subsidies on maize marketing in Malawi

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  • Sibande, Lonester
  • Bailey, Alastair
  • Davidova, Sophia

Abstract

This paper investigates the effects of subsidized fertilizer on marketing of maize in Malawi. It uses the nationally representative two-wave Integrated Household Panel Survey (IHPS) data of 2010 and 2013. The correlated random effects method of analyzing linear and non-linear panel data models is used to estimate the average partial effects. The control function approach of the instrumental variables methods is employed to control for potential endogeneity of subsidized fertilizer. The results suggest that subsidized fertilizer increases farmers’ market participation as sellers, quantity sold and commercialization of maize. However, the magnitudes of the effects are relatively smaller, which highlight the challenge of improving farm household income from sales of staple food crops. The results have implication on sustainability of the program, policy formulation and design of programs for the agricultural sector and small farmers in developing countries.

Suggested Citation

  • Sibande, Lonester & Bailey, Alastair & Davidova, Sophia, 2015. "The impact of farm input subsidies on maize marketing in Malawi," 2015 Conference, August 9-14, 2015, Milan, Italy 211918, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae15:211918
    DOI: 10.22004/ag.econ.211918
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    Keywords

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    JEL classification:

    • Q1 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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