Estimating the Benefits from Improved Market Information

Andrew M. Kizito

No 48844, Graduate Research Master's Degree Plan B Papers from Michigan State University, Department of Agricultural, Food, and Resource Economics

Abstract: Using a partial equilibrium model, the benefits of providing improved agricultural market information to farmers and small-scale traders of maize, millet, sorghum and paddy rice in Mali are estimated. The value of information is estimated as the reduction in dead-weight loss when farmers and small-scale traders with rational expectations respond to improved price forecasts from Market Information Systems. The study finds that benefits from improved information, which can also be viewed as a reduction of the cost of being off the equilibrium price and quantity, are great when there is high uncertainty about future prices, high own-price elasticity of supply, low own-price elasticity of demand, and high value of crop output. The study suggests that crop-specific, localized Market Information Systems (MIS) designed based on local area supply and demand responses to prices have higher returns than national uniformly distributed MISs covering a wide range of commodities in the country.

Keywords: Marketing (search for similar items in EconPapers)
Pages: 60
Date: 2009
New Economics Papers: this item is included in nep-agr
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Citations: View citations in EconPapers (16)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:midagr:48844

DOI: 10.22004/ag.econ.48844

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