Grain marketing policy changes and spatial efficiency of maize and wheat markets in Ethiopia
In the context of on-going market reform in developing countries, there is a need for an improvement in the existing methods of spatial market efficiency analysis in order to better inform the debate toward designing and implementing new grain marketing policies, institutions, and infrastructure tha...
| Autores principales: | , , |
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| Formato: | Artículo preliminar |
| Lenguaje: | Inglés |
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International Food Policy Research Institute
2004
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| Acceso en línea: | https://hdl.handle.net/10568/156842 |
| _version_ | 1855528412592996352 |
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| author | Negassa, Asfaw Myers, Robert J. Gabre-Madhin, Eleni Zaude |
| author_browse | Gabre-Madhin, Eleni Zaude Myers, Robert J. Negassa, Asfaw |
| author_facet | Negassa, Asfaw Myers, Robert J. Gabre-Madhin, Eleni Zaude |
| author_sort | Negassa, Asfaw |
| collection | Repository of Agricultural Research Outputs (CGSpace) |
| description | In the context of on-going market reform in developing countries, there is a need for an improvement in the existing methods of spatial market efficiency analysis in order to better inform the debate toward designing and implementing new grain marketing policies, institutions, and infrastructure that facilitate the emergence of a well developed and competitive grain marketing system. The standard parity bounds model (PBM), while it overcomes many weaknesses of the conventional methods of spatial market efficiency analysis, it does not allow for the test of structural changes in spatial market efficiency as a result of policy changes. In this paper, building on the standard PBM, we develop an extended parity bounds model (EPBM). The EPBM is a stochastic gradual switching model with three trade regimes. The EPBM is estimated by maximum likelihood procedure and allows for tracing the time path and structural change in spatial market efficiency conditions due to the policy changes. We applied the EPBM to analyze the effect of grain marketing policy changes on spatial efficiency of maize and wheat markets in Ethiopia. The results show that the effect of policy changes on spatial market efficiency is not significant statistically in many cases; there is high probability of spatial inefficiency in maize and wheat markets before and after the policy changes. The implication of these results is that maize and wheat markets are characterized by periodic gluts and shortages, which can undermine the welfare of producers, grain traders and consumers. It is also observed that the nature of spatial inefficiency for maize and wheat markets is different implying that the two commodities might require different policy responses in order to improve spatial market efficiency. Maize traders made losses most of the time while wheat traders made excess profits most of the time covered by the study. -- Authors' Abstract |
| format | Artículo preliminar |
| id | CGSpace156842 |
| institution | CGIAR Consortium |
| language | Inglés |
| publishDate | 2004 |
| publishDateRange | 2004 |
| publishDateSort | 2004 |
| publisher | International Food Policy Research Institute |
| publisherStr | International Food Policy Research Institute |
| record_format | dspace |
| spelling | CGSpace1568422025-11-06T06:33:00Z Grain marketing policy changes and spatial efficiency of maize and wheat markets in Ethiopia Negassa, Asfaw Myers, Robert J. Gabre-Madhin, Eleni Zaude grain crops maize wheat infrastructure marketing In the context of on-going market reform in developing countries, there is a need for an improvement in the existing methods of spatial market efficiency analysis in order to better inform the debate toward designing and implementing new grain marketing policies, institutions, and infrastructure that facilitate the emergence of a well developed and competitive grain marketing system. The standard parity bounds model (PBM), while it overcomes many weaknesses of the conventional methods of spatial market efficiency analysis, it does not allow for the test of structural changes in spatial market efficiency as a result of policy changes. In this paper, building on the standard PBM, we develop an extended parity bounds model (EPBM). The EPBM is a stochastic gradual switching model with three trade regimes. The EPBM is estimated by maximum likelihood procedure and allows for tracing the time path and structural change in spatial market efficiency conditions due to the policy changes. We applied the EPBM to analyze the effect of grain marketing policy changes on spatial efficiency of maize and wheat markets in Ethiopia. The results show that the effect of policy changes on spatial market efficiency is not significant statistically in many cases; there is high probability of spatial inefficiency in maize and wheat markets before and after the policy changes. The implication of these results is that maize and wheat markets are characterized by periodic gluts and shortages, which can undermine the welfare of producers, grain traders and consumers. It is also observed that the nature of spatial inefficiency for maize and wheat markets is different implying that the two commodities might require different policy responses in order to improve spatial market efficiency. Maize traders made losses most of the time while wheat traders made excess profits most of the time covered by the study. -- Authors' Abstract 2004 2024-10-24T12:45:46Z 2024-10-24T12:45:46Z Working Paper https://hdl.handle.net/10568/156842 en Open Access application/pdf International Food Policy Research Institute Negassa, Asfaw; Myers, Robert J.; Gabre-Madhin, Eleni Zaude. 2004. Grain marketing policy changes and spatial efficiency of maize and wheat markets in Ethiopia. MTID Discussion Paper 66. https://hdl.handle.net/10568/156842 |
| spellingShingle | grain crops maize wheat infrastructure marketing Negassa, Asfaw Myers, Robert J. Gabre-Madhin, Eleni Zaude Grain marketing policy changes and spatial efficiency of maize and wheat markets in Ethiopia |
| title | Grain marketing policy changes and spatial efficiency of maize and wheat markets in Ethiopia |
| title_full | Grain marketing policy changes and spatial efficiency of maize and wheat markets in Ethiopia |
| title_fullStr | Grain marketing policy changes and spatial efficiency of maize and wheat markets in Ethiopia |
| title_full_unstemmed | Grain marketing policy changes and spatial efficiency of maize and wheat markets in Ethiopia |
| title_short | Grain marketing policy changes and spatial efficiency of maize and wheat markets in Ethiopia |
| title_sort | grain marketing policy changes and spatial efficiency of maize and wheat markets in ethiopia |
| topic | grain crops maize wheat infrastructure marketing |
| url | https://hdl.handle.net/10568/156842 |
| work_keys_str_mv | AT negassaasfaw grainmarketingpolicychangesandspatialefficiencyofmaizeandwheatmarketsinethiopia AT myersrobertj grainmarketingpolicychangesandspatialefficiencyofmaizeandwheatmarketsinethiopia AT gabremadhinelenizaude grainmarketingpolicychangesandspatialefficiencyofmaizeandwheatmarketsinethiopia |