Decomposing producer price risk: a policy analysis tool with an application to northern Kenyan livestock markets
This paper introduces a simple method of price risk decomposition that determines the extent to which producer price risk is attributable to volatile inter-market margins, intra-day variation, intra-week (day of week) variation, or terminal market price variability. We apply the method to livestock...
| Main Authors: | , |
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| Format: | Journal Article |
| Language: | Inglés |
| Published: |
Elsevier
2004
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| Online Access: | https://hdl.handle.net/10568/929 |
| _version_ | 1855523652456415232 |
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| author | Barrett, Christopher B. Luseno, W.K. |
| author_browse | Barrett, Christopher B. Luseno, W.K. |
| author_facet | Barrett, Christopher B. Luseno, W.K. |
| author_sort | Barrett, Christopher B. |
| collection | Repository of Agricultural Research Outputs (CGSpace) |
| description | This paper introduces a simple method of price risk decomposition that determines the extent to which producer price risk is attributable to volatile inter-market margins, intra-day variation, intra-week (day of week) variation, or terminal market price variability. We apply the method to livestock markets in northern Kenya, a setting of dramatic price volatility where price stabilization is a live policy issue. In this particular application, we find that large, variable inter-market basis is the most important factor in explaining producer price risk in animals typically traded between markets. Local market conditions explain most price risk in other markets, in which traded animals rarely exit the region. Variability in terminal market prices accounts for relatively little price risk faced by pastoralists in the dry lands of northern Kenya although this is the focus of most present policy prescriptions under discussion. |
| format | Journal Article |
| id | CGSpace929 |
| institution | CGIAR Consortium |
| language | Inglés |
| publishDate | 2004 |
| publishDateRange | 2004 |
| publishDateSort | 2004 |
| publisher | Elsevier |
| publisherStr | Elsevier |
| record_format | dspace |
| spelling | CGSpace9292024-08-27T10:35:46Z Decomposing producer price risk: a policy analysis tool with an application to northern Kenyan livestock markets Barrett, Christopher B. Luseno, W.K. This paper introduces a simple method of price risk decomposition that determines the extent to which producer price risk is attributable to volatile inter-market margins, intra-day variation, intra-week (day of week) variation, or terminal market price variability. We apply the method to livestock markets in northern Kenya, a setting of dramatic price volatility where price stabilization is a live policy issue. In this particular application, we find that large, variable inter-market basis is the most important factor in explaining producer price risk in animals typically traded between markets. Local market conditions explain most price risk in other markets, in which traded animals rarely exit the region. Variability in terminal market prices accounts for relatively little price risk faced by pastoralists in the dry lands of northern Kenya although this is the focus of most present policy prescriptions under discussion. 2004-08 2010-03-26T12:27:12Z 2010-03-26T12:27:12Z Journal Article https://hdl.handle.net/10568/929 en Limited Access Elsevier Barrett, C.B.; Luseno, W.K. 2004. Decomposing producer price risk: a policy analysis tool with an application to northern Kenyan livestock markets. Food Policy 29(4):393-405. |
| spellingShingle | Barrett, Christopher B. Luseno, W.K. Decomposing producer price risk: a policy analysis tool with an application to northern Kenyan livestock markets |
| title | Decomposing producer price risk: a policy analysis tool with an application to northern Kenyan livestock markets |
| title_full | Decomposing producer price risk: a policy analysis tool with an application to northern Kenyan livestock markets |
| title_fullStr | Decomposing producer price risk: a policy analysis tool with an application to northern Kenyan livestock markets |
| title_full_unstemmed | Decomposing producer price risk: a policy analysis tool with an application to northern Kenyan livestock markets |
| title_short | Decomposing producer price risk: a policy analysis tool with an application to northern Kenyan livestock markets |
| title_sort | decomposing producer price risk a policy analysis tool with an application to northern kenyan livestock markets |
| url | https://hdl.handle.net/10568/929 |
| work_keys_str_mv | AT barrettchristopherb decomposingproducerpriceriskapolicyanalysistoolwithanapplicationtonorthernkenyanlivestockmarkets AT lusenowk decomposingproducerpriceriskapolicyanalysistoolwithanapplicationtonorthernkenyanlivestockmarkets |