IDEAS home Printed from https://ideas.repec.org/p/ags/uersrr/55943.html
   My bibliography  Save this paper

Trade and Development When Exports Lack Diversification: A Case Study From Malawi

Author

Listed:
  • Persaud, Suresh Chand
  • Meade, Birgit Gisela Saager

Abstract

Developing countries, particularly those that depend heavily on a small number of agricultural exports, are vulnerable to domestic and international shocks. These countries often have difficulty achieving sustained economic growth. This analysis uses Malawi, a country that earns most of its foreign exchange from tobacco, as a case study of export concentration and heavy exposure to volatility. The econometric results suggest that the decline in Malawi’s gross domestic product (GDP) when tobacco exports are falling is almost three times greater than the increase in GDP when exports are rising. Model-based simulations indicate that variability in tobacco exports leads to slower economic growth because GDP falls by a relatively large amount in response to a given decrease in exports, while recovering little during an upswing in exports. Gains in tobacco yield and improvements in marketing efficiency, however, can help buffer Malawi’s GDP from variability in export revenues.

Suggested Citation

  • Persaud, Suresh Chand & Meade, Birgit Gisela Saager, 2009. "Trade and Development When Exports Lack Diversification: A Case Study From Malawi," Economic Research Report 55943, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uersrr:55943
    DOI: 10.22004/ag.econ.55943
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/55943/files/ERR%2077%20Malawi%20final%209-10.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.55943?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alois Mandondo & Laura German, 2015. "Customary rights and societal stakes of large-scale tobacco cultivation in Malawi," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 32(1), pages 31-46, March.
    2. Oana Iuliana Rujoiu, 2021. "Challenges Relating Sustainable Structural Transformation," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(1), pages 419-425, August.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:uersrr:55943. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/ersgvus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.