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Cost-Benefit Analysis Of A Milk Processing Plant For The Benefits Of Pastoralists, Somali Region, Ethiopia


  • Glenn P. Jenkins

    () (Department of Economics, Queen's University, Canada, Eastern Mediterranean University, Mersin 10, Turkey)

  • Mikhail Miklyaev

    () (Eastern Mediterranean University, Famagusta, Mersin 10, Turkey)


Milk is one of the main sources for the livelihood of pastoralists around the world. Somali Region in Ethiopia is famous for the high density of livestock, implying significant potential for milk production. The perishable nature of the milk and the absence of the milk processing facilities do not allow this sector to fully utilize this potential, imposing significant economic losses on the community. This study assesses the economic feasibility of the milk processing plant in Jijiga city. The study analyses both moderate and aggressive enhancement options of the plant. The rigorous distributive analysis is used to estimate the allocation of the benefits arising to the government of Ethiopia, the pastoralists and the traders supplying milk to the plant, the labor involved employed by the facility, the Jijiga city community and the private entrepreneur. The sensitivity analysis is used to assess potential risk factors facing the facility.

Suggested Citation

  • Glenn P. Jenkins & Mikhail Miklyaev, 2014. "Cost-Benefit Analysis Of A Milk Processing Plant For The Benefits Of Pastoralists, Somali Region, Ethiopia," Development Discussion Papers 2013-09, JDI Executive Programs.
  • Handle: RePEc:qed:dpaper:233

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    More about this item


    cost-benefit analysis; investment appraisal; stakeholder analysis; pastoralism; milk processing; milk production; camel’s milk; poverty reduction; Jijiga; Somali Region; Ethiopia; sustainable development;

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • F35 - International Economics - - International Finance - - - Foreign Aid
    • Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development

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