Market Level Effects of World Food Program Local and Regional Procurement of Food Aid in Africa

This paper assesses the impact of local and regional procurement (LRP) of food aid on local market prices in Africa. In particular we study maize in Uganda and Mozambique and beans in Ethiopia. Two complementary modelling approaches are employed: a vector autoregression (VAR) and a computational model (CM). The VAR is a reduced-form econometric approach while the CM is a structural simulation approach. Using two different approaches provides a useful consistency check. Results from the VAR show average price increases brought about by LRP are statistically significant and range from 2% to 16%. The size of the average estimated price effects are economically meaningful for maize in Uganda but much smaller (though still statistically significant) for maize in Mozambique and beans in Ethiopia. In all three country applications, LRP is estimated to have no effect on price variability. Results from the CM fall within a 90% confidence bound around results obtained from the VAR.


Issue Date:
2015
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/211862
Total Pages:
42




 Record created 2017-04-01, last modified 2017-04-26

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