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Sustainability under Siege: Transport Costs and Corruption on West Africa's Trade Corridors

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  • Bromley, Daniel W.

    (University of Wisconsin-Madison)

  • Foltz, Jeremy D.

    (University of Wisconsin-Madison)

Abstract

This work analyzes the effects of transport costs and corruption on the sustainability of natural resources use in West Africa. We develop an explicitly spatial model of how transport costs and corruption can affect natural resource exploitation. We then test its implications using a unique dataset on trucker bribe payments on the major trucking routes of West Africa. These data allow us to estimate the effects of transport and corruption costs across three export market sectors: onions, shea nuts, and cashews. Results suggest that when net returns are suppressed by transport and corruption costs, investment in natural resource products is postponed or forsaken entirely, yields fall, net returns suffer, and farmers are caught in a cycle of falling productivity, reduced critical mass of tradable production, and perhaps even higher costs to arrange shipments.

Suggested Citation

  • Bromley, Daniel W. & Foltz, Jeremy D., 2010. "Sustainability under Siege: Transport Costs and Corruption on West Africa's Trade Corridors," Staff Paper Series 554, University of Wisconsin, Agricultural and Applied Economics.
  • Handle: RePEc:ecl:wisagr:554
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    References listed on IDEAS

    as
    1. Freund, Caroline & Rocha, Nadia, 2010. "What constrains Africa's exports?," WTO Staff Working Papers ERSD-2010-07, World Trade Organization (WTO), Economic Research and Statistics Division.
    2. Portugal-Perez, Alberto & Wilson, John S., 2009. "Why trade facilitation matters to Africa," World Trade Review, Cambridge University Press, vol. 8(03), pages 379-416, July.
    3. Benjamin A. Olken & Patrick Barron, 2009. "The Simple Economics of Extortion: Evidence from Trucking in Aceh," Journal of Political Economy, University of Chicago Press, vol. 117(3), pages 417-452, June.
    4. Elnagheeb, Abdelmoneim H. & Bromley, Daniel W., 1994. "Extensification of agriculture and deforestation: Empirical evidence from Sudan," Agricultural Economics, Blackwell, vol. 10(2), pages 193-200, April.
    5. Abdelmoneim Elnagheeb & Daniel Bromley, 1992. "Rainfed mechanized farming and deforestation in central Sudan," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 2(4), pages 359-371, July.
    6. Supee Teravaninthorn & Gaƫl Raballand, 2009. "Transport Prices and Costs in Africa : A Review of the International Corridors," World Bank Publications, The World Bank, number 6610, August.
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