Globalization and International Commodity Trade with Specific Reference to the West African Cocoa Producers

Christopher L. Gilbert and Panos Varangis

No 9668, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Liberalization of tropical agricultural markets has brought globalization, in the sense that all producers now face world rather than domestic prices. Producer prices have tended to rise as a share of fob prices as intermediation costs and tax has declined. However, in conjunction with inelastic demand, the downward shift of the aggregate supply curve results in lower world prices. Farmers therefore get a higher share of a lower price. Cocoa is the market where these changes have been most pronounced. The incidence of the liberalization benefits in cocoa is largely on developed country consumers at the expense of the governments of the exporting countries and farmers in non-liberalizing (non-African) countries. Farmers in liberalized African markets are broadly neither better nor worse off.

JEL-codes: F14 Q17 (search for similar items in EconPapers)
Date: 2003-05
New Economics Papers: this item is included in nep-afr
Note: ITI
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Citations: View citations in EconPapers (19)

Published as Baldwin, Robert E. and L. Alan Winters (eds.) Challenges to globalization: Analyzing the economics NBER Economic Research Conference Report series. Chicago and London: University of Chicago Press, 2004.
Published as Globalization and International Commodity Trade with Specific Reference to the West African Cocoa Producers , Christopher Gilbert, Panos Varangis. in Challenges to Globalization: Analyzing the Economics , Baldwin and Winters. 2004

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