The Relevance of a Rules-Based Maize Marketing Policy : An Experimental Case Study of Zambia

Strategic interaction between public and private actors is increasingly recognized as an important determinant of agricultural market performance in Africa and elsewhere. Trust and consultation tend to positively affect private activity while uncer...

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Main Authors:	Abbink, Klaus, Jayne, Thomas S., Moller, Lars C.
Format:	Policy Research Working Paper
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ACCOUNTING ACUTE FOOD SHORTAGES AGRICULTURAL DEVELOPMENT AGRICULTURAL ECONOMICS AGRICULTURAL POLICY AGRICULTURAL PRODUCTIVITY AGRICULTURE AUCTION AUCTIONS AVERAGE PRICE CENTRAL ASIAN COLLUSION COMPETITIVENESS CONFIDENCE CONSUMER DEMAND CONSUMER PRICE CONSUMER PRICES CONSUMER WELFARE DEMAND ELASTICITY DEMAND FUNCTION DEMAND FUNCTIONS DEMOCRACY DISCRETION DOMESTIC MARKET EFFICIENT MARKET EXPENDITURES EXTERNAL MARKETS FARM PRODUCTIVITY FARM PRODUCTIVITY GROWTH FOOD AID FOOD AVAILABILITY FOOD CRISIS FOOD MARKETING FOOD MARKETING SYSTEMS FOOD MARKETS FOOD POLICY FOOD POLICY RESEARCH FOOD PRICES FOOD SECURITY FOOD SECURITY POLICY FOOD SECURITY RESEARCH FOOD SHORTAGE FOOD SHORTAGES FOOD STOCKS FOOD SUPPLIES FOOD SUPPLY GOVERNMENT OFFICIALS IMPORTING MAIZE INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE INVESTIGATION MAIZE MAIZE IMPORTS MAIZE MARKET MAIZE MARKETING MAIZE MEAL MAIZE PRODUCTION MAIZE REVOLUTION MAIZE SECTOR MAIZE SUPPLY MAIZE TRADING MARKET CONDITIONS MARKET EQUILIBRIUM MARKET FLUCTUATIONS MARKET INFORMATION MARKET LIBERALIZATION MARKET PARTICIPANTS MARKET PERFORMANCE MARKET POWER MARKET PRICE MARKET PRICES MARKET REFORM MARKET REFORMS MARKET RISKS MARKETING MARKETING BOARD MARKETING BOARDS MARKETING POLICY MARKETING SYSTEM MEAL MILLERS MINISTER MINISTERS NATIONAL FARMERS UNION NATIONAL FOOD SECURITY PATRONAGE PRICE FLUCTUATIONS PRICE INDEX PRICE STABILITY PRICE STABILIZATION PRICING POLICIES PRODUCER PRICE PRODUCER PRICES PURCHASING RULING PARTY SALE SALES SMALLHOLDER AGRICULTURE STOCKS SUB-SAHARAN AFRICA SUBSIDIZED GRAIN SUBSTITUTE SUPPLIERS SUPPLY CURVES SURPLUSES TRANSPARENCY TRIALS TYING WHITE MAIZE
Online Access:	http://documents.worldbank.org/curated/en/2008/09/9882913/relevance-rules-based-maize-marketing-policy-experimental-case-study-zambia http://hdl.handle.net/10986/6948

id	okr-10986-6948
recordtype	oai_dc
spelling	okr-10986-69482021-04-23T14:02:32Z The Relevance of a Rules-Based Maize Marketing Policy : An Experimental Case Study of Zambia Abbink, Klaus Jayne, Thomas S. Moller, Lars C. ACCOUNTING ACUTE FOOD SHORTAGES AGRICULTURAL DEVELOPMENT AGRICULTURAL ECONOMICS AGRICULTURAL POLICY AGRICULTURAL PRODUCTIVITY AGRICULTURE AUCTION AUCTIONS AVERAGE PRICE CENTRAL ASIAN COLLUSION COMPETITIVENESS CONFIDENCE CONSUMER DEMAND CONSUMER PRICE CONSUMER PRICES CONSUMER WELFARE DEMAND ELASTICITY DEMAND FUNCTION DEMAND FUNCTIONS DEMOCRACY DISCRETION DOMESTIC MARKET EFFICIENT MARKET EXPENDITURES EXTERNAL MARKETS FARM PRODUCTIVITY FARM PRODUCTIVITY GROWTH FOOD AID FOOD AVAILABILITY FOOD CRISIS FOOD MARKETING FOOD MARKETING SYSTEMS FOOD MARKETS FOOD POLICY FOOD POLICY RESEARCH FOOD PRICES FOOD SECURITY FOOD SECURITY POLICY FOOD SECURITY RESEARCH FOOD SHORTAGE FOOD SHORTAGES FOOD STOCKS FOOD SUPPLIES FOOD SUPPLY GOVERNMENT OFFICIALS IMPORTING MAIZE INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE INVESTIGATION MAIZE MAIZE IMPORTS MAIZE MARKET MAIZE MARKETING MAIZE MEAL MAIZE PRODUCTION MAIZE REVOLUTION MAIZE SECTOR MAIZE SUPPLY MAIZE TRADING MARKET CONDITIONS MARKET EQUILIBRIUM MARKET FLUCTUATIONS MARKET INFORMATION MARKET LIBERALIZATION MARKET PARTICIPANTS MARKET PERFORMANCE MARKET POWER MARKET PRICE MARKET PRICES MARKET REFORM MARKET REFORMS MARKET RISKS MARKETING MARKETING BOARD MARKETING BOARDS MARKETING POLICY MARKETING SYSTEM MEAL MILLERS MINISTER MINISTERS NATIONAL FARMERS UNION NATIONAL FOOD SECURITY PATRONAGE PRICE FLUCTUATIONS PRICE INDEX PRICE STABILITY PRICE STABILIZATION PRICING POLICIES PRODUCER PRICE PRODUCER PRICES PURCHASING RULING PARTY SALE SALES SMALLHOLDER AGRICULTURE STOCKS SUB-SAHARAN AFRICA SUBSIDIZED GRAIN SUBSTITUTE SUPPLIERS SUPPLY CURVES SURPLUSES TRANSPARENCY TRIALS TYING WHITE MAIZE Strategic interaction between public and private actors is increasingly recognized as an important determinant of agricultural market performance in Africa and elsewhere. Trust and consultation tend to positively affect private activity while uncertainty of government behavior impedes it. This paper reports on a laboratory experiment based on a stylized model of the Zambian maize market. The experiment facilitates a comparison between discretionary interventionism and a rules-based policy in which the government pre-commits itself to a future course of action. A simple precommitment rule can, in theory, overcome the prevailing strategic dilemma by encouraging private sector participation. Although this result is also borne out in the economic experiment, the improvement in private sector activity is surprisingly small and not statistically significant due to irrationally cautious choices by experimental governments. Encouragingly, a rules-based policy promotes a much more stable market outcome, thereby substantially reducing the risk of severe food shortages. These results underscore the importance of predictable and transparent rules for the state's involvement in agricultural markets. 2012-06-01T22:07:15Z 2012-06-01T22:07:15Z 2008-09 http://documents.worldbank.org/curated/en/2008/09/9882913/relevance-rules-based-maize-marketing-policy-experimental-case-study-zambia http://hdl.handle.net/10986/6948 English Policy Research Working Paper; No. 4727 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Africa Zambia
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ACCOUNTING ACUTE FOOD SHORTAGES AGRICULTURAL DEVELOPMENT AGRICULTURAL ECONOMICS AGRICULTURAL POLICY AGRICULTURAL PRODUCTIVITY AGRICULTURE AUCTION AUCTIONS AVERAGE PRICE CENTRAL ASIAN COLLUSION COMPETITIVENESS CONFIDENCE CONSUMER DEMAND CONSUMER PRICE CONSUMER PRICES CONSUMER WELFARE DEMAND ELASTICITY DEMAND FUNCTION DEMAND FUNCTIONS DEMOCRACY DISCRETION DOMESTIC MARKET EFFICIENT MARKET EXPENDITURES EXTERNAL MARKETS FARM PRODUCTIVITY FARM PRODUCTIVITY GROWTH FOOD AID FOOD AVAILABILITY FOOD CRISIS FOOD MARKETING FOOD MARKETING SYSTEMS FOOD MARKETS FOOD POLICY FOOD POLICY RESEARCH FOOD PRICES FOOD SECURITY FOOD SECURITY POLICY FOOD SECURITY RESEARCH FOOD SHORTAGE FOOD SHORTAGES FOOD STOCKS FOOD SUPPLIES FOOD SUPPLY GOVERNMENT OFFICIALS IMPORTING MAIZE INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE INVESTIGATION MAIZE MAIZE IMPORTS MAIZE MARKET MAIZE MARKETING MAIZE MEAL MAIZE PRODUCTION MAIZE REVOLUTION MAIZE SECTOR MAIZE SUPPLY MAIZE TRADING MARKET CONDITIONS MARKET EQUILIBRIUM MARKET FLUCTUATIONS MARKET INFORMATION MARKET LIBERALIZATION MARKET PARTICIPANTS MARKET PERFORMANCE MARKET POWER MARKET PRICE MARKET PRICES MARKET REFORM MARKET REFORMS MARKET RISKS MARKETING MARKETING BOARD MARKETING BOARDS MARKETING POLICY MARKETING SYSTEM MEAL MILLERS MINISTER MINISTERS NATIONAL FARMERS UNION NATIONAL FOOD SECURITY PATRONAGE PRICE FLUCTUATIONS PRICE INDEX PRICE STABILITY PRICE STABILIZATION PRICING POLICIES PRODUCER PRICE PRODUCER PRICES PURCHASING RULING PARTY SALE SALES SMALLHOLDER AGRICULTURE STOCKS SUB-SAHARAN AFRICA SUBSIDIZED GRAIN SUBSTITUTE SUPPLIERS SUPPLY CURVES SURPLUSES TRANSPARENCY TRIALS TYING WHITE MAIZE
spellingShingle	ACCOUNTING ACUTE FOOD SHORTAGES AGRICULTURAL DEVELOPMENT AGRICULTURAL ECONOMICS AGRICULTURAL POLICY AGRICULTURAL PRODUCTIVITY AGRICULTURE AUCTION AUCTIONS AVERAGE PRICE CENTRAL ASIAN COLLUSION COMPETITIVENESS CONFIDENCE CONSUMER DEMAND CONSUMER PRICE CONSUMER PRICES CONSUMER WELFARE DEMAND ELASTICITY DEMAND FUNCTION DEMAND FUNCTIONS DEMOCRACY DISCRETION DOMESTIC MARKET EFFICIENT MARKET EXPENDITURES EXTERNAL MARKETS FARM PRODUCTIVITY FARM PRODUCTIVITY GROWTH FOOD AID FOOD AVAILABILITY FOOD CRISIS FOOD MARKETING FOOD MARKETING SYSTEMS FOOD MARKETS FOOD POLICY FOOD POLICY RESEARCH FOOD PRICES FOOD SECURITY FOOD SECURITY POLICY FOOD SECURITY RESEARCH FOOD SHORTAGE FOOD SHORTAGES FOOD STOCKS FOOD SUPPLIES FOOD SUPPLY GOVERNMENT OFFICIALS IMPORTING MAIZE INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE INVESTIGATION MAIZE MAIZE IMPORTS MAIZE MARKET MAIZE MARKETING MAIZE MEAL MAIZE PRODUCTION MAIZE REVOLUTION MAIZE SECTOR MAIZE SUPPLY MAIZE TRADING MARKET CONDITIONS MARKET EQUILIBRIUM MARKET FLUCTUATIONS MARKET INFORMATION MARKET LIBERALIZATION MARKET PARTICIPANTS MARKET PERFORMANCE MARKET POWER MARKET PRICE MARKET PRICES MARKET REFORM MARKET REFORMS MARKET RISKS MARKETING MARKETING BOARD MARKETING BOARDS MARKETING POLICY MARKETING SYSTEM MEAL MILLERS MINISTER MINISTERS NATIONAL FARMERS UNION NATIONAL FOOD SECURITY PATRONAGE PRICE FLUCTUATIONS PRICE INDEX PRICE STABILITY PRICE STABILIZATION PRICING POLICIES PRODUCER PRICE PRODUCER PRICES PURCHASING RULING PARTY SALE SALES SMALLHOLDER AGRICULTURE STOCKS SUB-SAHARAN AFRICA SUBSIDIZED GRAIN SUBSTITUTE SUPPLIERS SUPPLY CURVES SURPLUSES TRANSPARENCY TRIALS TYING WHITE MAIZE Abbink, Klaus Jayne, Thomas S. Moller, Lars C. The Relevance of a Rules-Based Maize Marketing Policy : An Experimental Case Study of Zambia
geographic_facet	Africa Zambia
relation	Policy Research Working Paper; No. 4727
description	Strategic interaction between public and private actors is increasingly recognized as an important determinant of agricultural market performance in Africa and elsewhere. Trust and consultation tend to positively affect private activity while uncertainty of government behavior impedes it. This paper reports on a laboratory experiment based on a stylized model of the Zambian maize market. The experiment facilitates a comparison between discretionary interventionism and a rules-based policy in which the government pre-commits itself to a future course of action. A simple precommitment rule can, in theory, overcome the prevailing strategic dilemma by encouraging private sector participation. Although this result is also borne out in the economic experiment, the improvement in private sector activity is surprisingly small and not statistically significant due to irrationally cautious choices by experimental governments. Encouragingly, a rules-based policy promotes a much more stable market outcome, thereby substantially reducing the risk of severe food shortages. These results underscore the importance of predictable and transparent rules for the state's involvement in agricultural markets.
format	Publications & Research :: Policy Research Working Paper
author	Abbink, Klaus Jayne, Thomas S. Moller, Lars C.
author_facet	Abbink, Klaus Jayne, Thomas S. Moller, Lars C.
author_sort	Abbink, Klaus
title	The Relevance of a Rules-Based Maize Marketing Policy : An Experimental Case Study of Zambia
title_short	The Relevance of a Rules-Based Maize Marketing Policy : An Experimental Case Study of Zambia
title_full	The Relevance of a Rules-Based Maize Marketing Policy : An Experimental Case Study of Zambia
title_fullStr	The Relevance of a Rules-Based Maize Marketing Policy : An Experimental Case Study of Zambia
title_full_unstemmed	The Relevance of a Rules-Based Maize Marketing Policy : An Experimental Case Study of Zambia
title_sort	relevance of a rules-based maize marketing policy : an experimental case study of zambia
publisher	World Bank, Washington, DC
publishDate	2012
url	http://documents.worldbank.org/curated/en/2008/09/9882913/relevance-rules-based-maize-marketing-policy-experimental-case-study-zambia http://hdl.handle.net/10986/6948
_version_	1764401158355419136

The Relevance of a Rules-Based Maize Marketing Policy : An Experimental Case Study of Zambia

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