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Market Liberalisation, Vertical Integration and Price Behaviour in Tanzania's Coffee Auction

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  • Anna A. Temu
  • Alex Winter‐Nelson
  • Philip Garcia

Abstract

Whether market liberalisation can promote agricultural development in Africa depends on how well existing institutions can facilitate trade by private agents. This article assesses the performance of the Tanzania coffee marketing system after liberalisation and the emergence of private, vertically integrated exporters (VIEs). Increasing producer prices, declining marketing margins, and the continued provision of a useful auction for coffee that is delivered by traders who are not VIEs all suggest a degree of success for liberalisation. The presence of VIEs seems to have provided investment to reduce marketing costs, whilst a sufficient number of competing firms has limited non‐competitive behaviour in the market for coffee that is traded at the auction by non‐VIEs.

Suggested Citation

  • Anna A. Temu & Alex Winter‐Nelson & Philip Garcia, 2001. "Market Liberalisation, Vertical Integration and Price Behaviour in Tanzania's Coffee Auction," Development Policy Review, Overseas Development Institute, vol. 19(2), pages 205-222, June.
    • Handle: RePEc:bla:devpol:v:19:y:2001:i:2:p:205-222
    DOI: 10.1111/1467-7679.00131
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    Cited by:

    1. Morrissey, Oliver & Leyaro, Vincent, 2007. "Distortions to Agricultural Incentives in Tanzania," Agricultural Distortions Working Paper Series 48550, World Bank.
    2. Winter-Nelson, Alex & Temu, Anna, 2002. "Institutional Adjustment and Transaction Costs: Product and Inputs Markets in the Tanzanian Coffee System," World Development, Elsevier, vol. 30(4), pages 561-574, April.
    3. Kartikeya Puranam & Michael Katehakis, 2014. "On optimal bidding and inventory control in sequential procurement auctions: the multi period case," Annals of Operations Research, Springer, vol. 217(1), pages 447-462, June.

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