Measuring the Impact of a Change in the Price of Cashew Received by Exporters on Farmgate Prices and Poverty in Guinea-Bissau
This paper assesses the impact of a change in the price of cashew received by exporters in general -- and by FUNPI, a fund to promote the industrialization of agricultural products, in particular -- on farmgate prices and poverty in Guinea-Bissau....
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank Group, Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2014/09/20211379/measuring-impact-change-price-cashew-received-exporters-farmgate-prices-poverty-guinea-bissau-measuring-impact-change-price-cashew-received-exporters-farmgate-prices-poverty-guinea-bissau http://hdl.handle.net/10986/20369 |
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okr-10986-203692021-04-23T14:03:55Z Measuring the Impact of a Change in the Price of Cashew Received by Exporters on Farmgate Prices and Poverty in Guinea-Bissau Cont, Walter Porto, Guido AGRICULTURE AUCTION AVERAGE COSTS AVERAGE PRICE BENEFICIARIES BID BIDS BROKERS BUDGET CONSTRAINTS CAPACITY CONSTRAINT CAPACITY CONSTRAINTS CASH TRANSFERS COLLUSION COMMODITY COMPETITION POLICIES COMPETITION POLICY COMPETITIVE EQUILIBRIUM COMPETITIVE MARKET COMPETITIVE PRICES COST FUNCTIONS COST REDUCTION COST REDUCTIONS COST STRUCTURE COST STRUCTURES DEMAND FUNCTIONS DEVELOPMENT POLICY DISTRIBUTION OF INCOME DOMESTIC PRICES ELASTICITY OF SUPPLY EQUILIBRIUM PRICE EQUILIBRIUM PRICES EQUILIBRIUM VALUES EXCHANGE RATE EXPENDITURE EXPENDITURES EXPORTER EXPORTERS EXPORTS EXPOSURE EXTREME POVERTY FUNCTIONAL FORMS GDP GOVERNANCE MECHANISMS GOVERNMENT ACTION GOVERNMENT REVENUES HOMOGENEOUS GOODS HOUSEHOLD INCOME IMPERFECT COMPETITION INCOME INDIVIDUAL FIRMS INDUSTRIALIZATION INPUT PRICES INSTRUMENT INTERNATIONAL BANK INTERNATIONAL MARKET MACROECONOMICS MARGINAL COST MARGINAL COSTS MARKET CONCENTRATION MARKET DATA MARKET PARTICIPANTS MARKET PLAYERS MARKET SHARE MARKET SHARES MARKET SIZE MARKET STRUCTURE MONOPOLIES MONOPOLY NASH EQUILIBRIUM OFFER QUANTITIES OLIGOPOLY OPTIMIZATION OUTPUT PRICE CHANGE PRICE CHANGES PRICE DECREASES PRICE ELASTICITY PRICE ELASTICITY OF SUPPLY PRICE FLUCTUATIONS PRICE INCREASE PRICE INCREASES PRICE MARGIN PRICE POLICY PRICE STRUCTURE PRICE VOLATILITY PRODUCER PRICE PRODUCER PRICES PROFIT FUNCTIONS PROFIT MAXIMIZATION PUBLIC FUNDS REAL INCOME RETURN SALES SINGLE MARKET STOCKS SUBSTITUTE SUBSTITUTION SUPPLY CHAIN SUPPLY CHAINS SUPPLY ELASTICITY SUPPLY FUNCTION SURPLUS TAX TAX RATES TAX REVENUES TOTAL REVENUE TRADE TAX TRADE TAXES TRADES TRADING TRANSACTION TRANSACTION COSTS UTILITY FUNCTION This paper assesses the impact of a change in the price of cashew received by exporters in general -- and by FUNPI, a fund to promote the industrialization of agricultural products, in particular -- on farmgate prices and poverty in Guinea-Bissau. The analysis builds a theoretical model of supply chains in export agriculture that includes exporters, traders, and farmers competing in a bilateral oligopoly fashion. The model is adapted to data from the country's cashew sector and a household survey. Given the market structure, a shock on export prices or the introduction of an export tax, such as the FUNPI contribution, has a strong effect on farmgate prices, as farmers absorb about 80 percent of the tax (while exporters take up 13 percent and traders absorb the remaining 7 percent). The effect is uneven across households, as poor rural households are more exposed to price volatility and most cashew farmers are poor. It is estimated that their income falls by 12 percent as a result of the FUNPI contribution. Complementary policies can overcome the effect of the FUNPI surcharge on farmgate prices by aiming for reductions in transport, infrastructure, and transaction costs for traders and exporters. Fostering cashew processing would create added value through a displacement of volume from exporters to processors. The analysis finds it implausible that, under reasonable assumtions, a subsidy would overturn the welfare costs of the FUNPI contribution. 2014-10-06T20:20:32Z 2014-10-06T20:20:32Z 2014-09 http://documents.worldbank.org/curated/en/2014/09/20211379/measuring-impact-change-price-cashew-received-exporters-farmgate-prices-poverty-guinea-bissau-measuring-impact-change-price-cashew-received-exporters-farmgate-prices-poverty-guinea-bissau http://hdl.handle.net/10986/20369 English en_US Policy Research Working Paper;No. 7036 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Group, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Africa Guinea-Bissau |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
AGRICULTURE AUCTION AVERAGE COSTS AVERAGE PRICE BENEFICIARIES BID BIDS BROKERS BUDGET CONSTRAINTS CAPACITY CONSTRAINT CAPACITY CONSTRAINTS CASH TRANSFERS COLLUSION COMMODITY COMPETITION POLICIES COMPETITION POLICY COMPETITIVE EQUILIBRIUM COMPETITIVE MARKET COMPETITIVE PRICES COST FUNCTIONS COST REDUCTION COST REDUCTIONS COST STRUCTURE COST STRUCTURES DEMAND FUNCTIONS DEVELOPMENT POLICY DISTRIBUTION OF INCOME DOMESTIC PRICES ELASTICITY OF SUPPLY EQUILIBRIUM PRICE EQUILIBRIUM PRICES EQUILIBRIUM VALUES EXCHANGE RATE EXPENDITURE EXPENDITURES EXPORTER EXPORTERS EXPORTS EXPOSURE EXTREME POVERTY FUNCTIONAL FORMS GDP GOVERNANCE MECHANISMS GOVERNMENT ACTION GOVERNMENT REVENUES HOMOGENEOUS GOODS HOUSEHOLD INCOME IMPERFECT COMPETITION INCOME INDIVIDUAL FIRMS INDUSTRIALIZATION INPUT PRICES INSTRUMENT INTERNATIONAL BANK INTERNATIONAL MARKET MACROECONOMICS MARGINAL COST MARGINAL COSTS MARKET CONCENTRATION MARKET DATA MARKET PARTICIPANTS MARKET PLAYERS MARKET SHARE MARKET SHARES MARKET SIZE MARKET STRUCTURE MONOPOLIES MONOPOLY NASH EQUILIBRIUM OFFER QUANTITIES OLIGOPOLY OPTIMIZATION OUTPUT PRICE CHANGE PRICE CHANGES PRICE DECREASES PRICE ELASTICITY PRICE ELASTICITY OF SUPPLY PRICE FLUCTUATIONS PRICE INCREASE PRICE INCREASES PRICE MARGIN PRICE POLICY PRICE STRUCTURE PRICE VOLATILITY PRODUCER PRICE PRODUCER PRICES PROFIT FUNCTIONS PROFIT MAXIMIZATION PUBLIC FUNDS REAL INCOME RETURN SALES SINGLE MARKET STOCKS SUBSTITUTE SUBSTITUTION SUPPLY CHAIN SUPPLY CHAINS SUPPLY ELASTICITY SUPPLY FUNCTION SURPLUS TAX TAX RATES TAX REVENUES TOTAL REVENUE TRADE TAX TRADE TAXES TRADES TRADING TRANSACTION TRANSACTION COSTS UTILITY FUNCTION |
| spellingShingle |
AGRICULTURE AUCTION AVERAGE COSTS AVERAGE PRICE BENEFICIARIES BID BIDS BROKERS BUDGET CONSTRAINTS CAPACITY CONSTRAINT CAPACITY CONSTRAINTS CASH TRANSFERS COLLUSION COMMODITY COMPETITION POLICIES COMPETITION POLICY COMPETITIVE EQUILIBRIUM COMPETITIVE MARKET COMPETITIVE PRICES COST FUNCTIONS COST REDUCTION COST REDUCTIONS COST STRUCTURE COST STRUCTURES DEMAND FUNCTIONS DEVELOPMENT POLICY DISTRIBUTION OF INCOME DOMESTIC PRICES ELASTICITY OF SUPPLY EQUILIBRIUM PRICE EQUILIBRIUM PRICES EQUILIBRIUM VALUES EXCHANGE RATE EXPENDITURE EXPENDITURES EXPORTER EXPORTERS EXPORTS EXPOSURE EXTREME POVERTY FUNCTIONAL FORMS GDP GOVERNANCE MECHANISMS GOVERNMENT ACTION GOVERNMENT REVENUES HOMOGENEOUS GOODS HOUSEHOLD INCOME IMPERFECT COMPETITION INCOME INDIVIDUAL FIRMS INDUSTRIALIZATION INPUT PRICES INSTRUMENT INTERNATIONAL BANK INTERNATIONAL MARKET MACROECONOMICS MARGINAL COST MARGINAL COSTS MARKET CONCENTRATION MARKET DATA MARKET PARTICIPANTS MARKET PLAYERS MARKET SHARE MARKET SHARES MARKET SIZE MARKET STRUCTURE MONOPOLIES MONOPOLY NASH EQUILIBRIUM OFFER QUANTITIES OLIGOPOLY OPTIMIZATION OUTPUT PRICE CHANGE PRICE CHANGES PRICE DECREASES PRICE ELASTICITY PRICE ELASTICITY OF SUPPLY PRICE FLUCTUATIONS PRICE INCREASE PRICE INCREASES PRICE MARGIN PRICE POLICY PRICE STRUCTURE PRICE VOLATILITY PRODUCER PRICE PRODUCER PRICES PROFIT FUNCTIONS PROFIT MAXIMIZATION PUBLIC FUNDS REAL INCOME RETURN SALES SINGLE MARKET STOCKS SUBSTITUTE SUBSTITUTION SUPPLY CHAIN SUPPLY CHAINS SUPPLY ELASTICITY SUPPLY FUNCTION SURPLUS TAX TAX RATES TAX REVENUES TOTAL REVENUE TRADE TAX TRADE TAXES TRADES TRADING TRANSACTION TRANSACTION COSTS UTILITY FUNCTION Cont, Walter Porto, Guido Measuring the Impact of a Change in the Price of Cashew Received by Exporters on Farmgate Prices and Poverty in Guinea-Bissau |
| geographic_facet |
Africa Guinea-Bissau |
| relation |
Policy Research Working Paper;No. 7036 |
| description |
This paper assesses the impact of a
change in the price of cashew received by exporters in
general -- and by FUNPI, a fund to promote the
industrialization of agricultural products, in particular --
on farmgate prices and poverty in Guinea-Bissau. The
analysis builds a theoretical model of supply chains in
export agriculture that includes exporters, traders, and
farmers competing in a bilateral oligopoly fashion. The
model is adapted to data from the country's cashew
sector and a household survey. Given the market structure, a
shock on export prices or the introduction of an export tax,
such as the FUNPI contribution, has a strong effect on
farmgate prices, as farmers absorb about 80 percent of the
tax (while exporters take up 13 percent and traders absorb
the remaining 7 percent). The effect is uneven across
households, as poor rural households are more exposed to
price volatility and most cashew farmers are poor. It is
estimated that their income falls by 12 percent as a result
of the FUNPI contribution. Complementary policies can
overcome the effect of the FUNPI surcharge on farmgate
prices by aiming for reductions in transport,
infrastructure, and transaction costs for traders and
exporters. Fostering cashew processing would create added
value through a displacement of volume from exporters to
processors. The analysis finds it implausible that, under
reasonable assumtions, a subsidy would overturn the welfare
costs of the FUNPI contribution. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Cont, Walter Porto, Guido |
| author_facet |
Cont, Walter Porto, Guido |
| author_sort |
Cont, Walter |
| title |
Measuring the Impact of a Change in the Price of Cashew Received by Exporters on Farmgate Prices and Poverty in Guinea-Bissau |
| title_short |
Measuring the Impact of a Change in the Price of Cashew Received by Exporters on Farmgate Prices and Poverty in Guinea-Bissau |
| title_full |
Measuring the Impact of a Change in the Price of Cashew Received by Exporters on Farmgate Prices and Poverty in Guinea-Bissau |
| title_fullStr |
Measuring the Impact of a Change in the Price of Cashew Received by Exporters on Farmgate Prices and Poverty in Guinea-Bissau |
| title_full_unstemmed |
Measuring the Impact of a Change in the Price of Cashew Received by Exporters on Farmgate Prices and Poverty in Guinea-Bissau |
| title_sort |
measuring the impact of a change in the price of cashew received by exporters on farmgate prices and poverty in guinea-bissau |
| publisher |
World Bank Group, Washington, DC |
| publishDate |
2014 |
| url |
http://documents.worldbank.org/curated/en/2014/09/20211379/measuring-impact-change-price-cashew-received-exporters-farmgate-prices-poverty-guinea-bissau-measuring-impact-change-price-cashew-received-exporters-farmgate-prices-poverty-guinea-bissau http://hdl.handle.net/10986/20369 |
| _version_ |
1764445175004790784 |