Traditional Agricultural Exports, External Dependency And Domestic Price Policies. African Coffee Exports In A Comparative Perspective

The paper analyses the impact of price variables on coffee production and exports in a selected group of developing countries, with particular focus on a subgroup of Sub-Saharan countries. Due to the dependency of coffee producers on the vagaries of the international market, direct crop taxation and exchange rate policies in these countries are found to be only partially endogenous. The long-run impact of policies on producers’ behaviour is then tested by means of a cross-country linear regression model. About one third of cross-country variability in planted areas is found to be attributable to exchange rate and, to a lesser extent, taxation policies. However, price policies do not appear to exert any significant impact on yields. No parametrically significant difference between sub-Saharan Africa and the rest of the world emerges from the analysis. The results show that, in the case of coffee, the weight of domestic price policies in determining production and exports is relevant, but should not be exaggerated, as most of the cross-country variability in performance in the coffee sector is in fact related to non-price factors, some of which can be modified by strategic non-price policy interventions.