Export Taxes and Consumption: Evidence from Côte d’Ivoire’s De Facto Partition

Souleymane Soumahoro

Economic Development and Cultural Change, 2017, vol. 65, issue 3, 425 - 456

Abstract: I exploit the emergence of two de facto states in Côte d’Ivoire during the 2002–11 political crisis to examine the effects of an export tax reduction for cocoa beans on the living standards of farming households. Combining both spatial and temporal variations in exposure to a set of dichotomous export tax policies, I find that farmers in low export tax districts significantly increased their consumption expenditures relative to farmers in high tax districts. I also provide evidence that the transmission of border prices to local farmers is a relevant mechanism through which the reduction of trade barriers enhances cocoa farmers’ living standards.

Date: 2017
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