Focuses on the effects of Nigeria's trade and exchange rate policies on agricultural incentives especially during the 1970s, the period of the oil boom. Attempts to determine the degree of protection granted to agriculture compared with other sectors, and assesses how these policies affected the allocation of resources both within agriculture and among the other sectors.
The International Food Policy Research Institute gathered experts in agricultural and economic growth from both government and academia to produce this study. Drawing on economic theory and empirical evidence, the contributors discuss the relative merits of alternative economic policies in a variety of countries, including Peru, Nigeria, Pakistan, and the Philippines. Annotation c. by Book News, Inc., Portland, Or.
Doctoral Thesis / Dissertation from the year 2017 in the subject Agrarian Studies, University of Ibadan (Department of Economics), course: Economics, language: English, abstract: The study was anchored on theories of production and supply response. A Nerlovian supply response model (1956) as modified by Karbasi and Tavana (2008) which captures the impact of trade and exchange rate reforms on agricultural commodities prices and outputs, and with acreage cultivated, labour and cost of agricultural machinery as control variables was explored. Major cash crops (cocoa, palm produce, palm kernel, groundnuts, rubber and cotton) and food (cassava, maize, yam and rice accounting for 28.0% of the 40.0% of staple food output) were purposively selected. Data were collected from the World Trade Organisation Trade Statistics, World Bank UN-COMTRADE statistics and World Development Indicators; Food and Agricultural Organisation Year Book Statistics and Agricultural Market Access Database; Central bank of Nigeria’s Statistical Bulletin and National Bureau of Statistics Annual Abstracts of Statistics. A Structural Vector Autoregression model was estimated via the generalized Impulse response functions and variance decomposition estimation techniques. All estimates were validated at p≤0.05. Trade policy shifted from a restrictive regime in 1970 to a liberalized regime starting from1995. Exchange rate policy similarly moved from a fixed regime in 1970 to a managed/float regime from 1986 to 2013. These reforms had diverse significant effects on both the prices and outputs of all sampled agricultural commodities. Trade effect was positive for palm kernel, cotton, rubber and cassava, while negative for the others. The effects were permanent across the ten commodities, while the elasticities for all the commodities range between 0.002 and 0.05. Exchange rate effect was positive for palm kernel, cotton, maize and rice, while negative for the others. The effects were also permanent except for rubber which was transitory, while elasticities for the commodities range between 0.1 and 2.3. On aggregate, the cost of machinery was found to be negatively related to the commodities outputs. A percentage increase in the cost of machinery brings about a 15.0 percent decline in output. Land and labour were positively and negatively related to output, respectively. An additional acre of land cultivation increased aggregate supply by 31.1%, while an increase in the use of labour decreased output by 19.0%. Trade and exchange rate reforms were critical in explaining the supply responses of sampled commodities, hence, the need for favourable and stable reforms.
The vast majority of the world s poorest households depend on farming for their livelihoods. During the 1960s and 1970s, most developing countries imposed pro-urban and anti-agricultural policies, while many high-income countries restricted agricultural imports and subsidized their farmers. Both sets of policies inhibited economic growth and poverty alleviation in developing countries. Although progress has been made over the past two decades to reduce those policy biases, many trade- and welfare-reducing price distortions remain between agriculture and other sectors and within the agricultural sector of both rich and poor countries. Comprehensive empirical studies of the disarray in world agricultural markets appeared approximately 20 years ago. Since then, the Organisation for Economic Co-operation and Development has provided estimates each year of market distortions in high-income countries, but there have been no comparable estimates for the world s developing countries. This volume is the third in a series (other volumes cover Asia, Europe s transition economies, and Latin America and the Caribbean) that not only fills that void for recent years but extends the estimates in a consistent and comparable way back in time and provides analytical narratives for scores of countries that shed light on the evolving nature and extent of policy interventions over the past half-century. 'Distortions to Agricultural Incentives in Africa' provides an overview of the evolution of distortions to agricultural incentives caused by price and trade policies in the Arab Republic of Egypt plus 20 countries that account for about of 90 percent of Sub-Saharan Africa s population, farm households, agricultural output, and overall GDP. Sectoral, trade, and exchange rate policies in the region have changed greatly since the 1950s, and there have been substantial reforms since the 1980s. Nonetheless, numerous price distortions in this region remain, others have been added in recent years, and there has also been some backsliding, such as in Zimbabwe. The new empirical indicators in these country studies provide a strong evidence-based foundation for assessing the successes and failures of the past and for evaluating policy options for the years ahead.
