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Evaluating price volatility and the role of trade in Eastern and Southern African maize markets

Author

Listed:
  • David, T.
  • Gitau, R.
  • Meyer, F.H.
  • Chisanga, B.
  • Jayne, T.S.

Abstract

Food price volatility, particularly in key food staple markets, has been a long standing challenge in Sub-Saharan Africa, where prices are already some of the highest in the world. In many cases, governments have acted to curb volatility, though several researchers have shown that actions aimed at reducing volatility in the short run have often been counterproductive for long term aims of market led productivity growth that would be able to reduce high prices in the region. With increased intra-regional trade having been proposed as a solution to volatile prices in the region, this study finds that across a sample of 36 maize markets in Eastern and Southern Africa between 2008 and 2014, volatility is significantly lower in markets with higher trade volumes. Thus it postulates that policies aimed at increasing the efficiency and reducing the cost of intra-regional trade will be efficient in curbing volatility in the region, thus improving food security.

Suggested Citation

  • David, T. & Gitau, R. & Meyer, F.H. & Chisanga, B. & Jayne, T.S., 2016. "Evaluating price volatility and the role of trade in Eastern and Southern African maize markets," 2016 Fifth International Conference, September 23-26, 2016, Addis Ababa, Ethiopia 249291, African Association of Agricultural Economists (AAAE).
    • Handle: RePEc:ags:aaae16:249291
    DOI: 10.22004/ag.econ.249291
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    References listed on IDEAS

    as
    1. John Baffes & Varun Kshirsagar & Donald Mitchell, 2019. "What Drives Local Food Prices? Evidence from the Tanzanian Maize Market," The World Bank Economic Review, World Bank, vol. 33(1), pages 160-184.
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    4. Traub, Lulama Ndibongo & Myers, Robert J. & Jayne, Thomas S. & Meyer, Ferdinand H., 2010. "Measuring Integration and Efficiency in Maize Grain Markets: The Case of South Africa and Mozambique," 2010 AAAE Third Conference/AEASA 48th Conference, September 19-23, 2010, Cape Town, South Africa 96644, African Association of Agricultural Economists (AAAE).
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    7. Jayne, Thomas S. & Tschirley, David L., 2009. "Food Price Spikes and Strategic Interactions between the Public and Private Sectors: Market Failures or Governance Failures," Food Security Collaborative Working Papers 97142, Michigan State University, Department of Agricultural, Food, and Resource Economics.
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    Cited by:

    1. Chen, Bowen & Villoria, Nelson B., 2018. "Food Price Variability and Import Dependence: A Country Panel Analysis," 2018 Annual Meeting, August 5-7, Washington, D.C. 274285, Agricultural and Applied Economics Association.

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    Keywords

    Demand and Price Analysis; International Relations/Trade; Marketing;
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