Emiliano Magrini

Agricultural (Dis)Incentives and Food Security: is there a link?

Abstract Using the World Bank database “Distortions to agricultural incentives,” this paper analyzes the impact that agricultural (dis)incentives have on food security for a wide sample of countries over the 1990‐2010 period. We adopt a continuous treatment approach applying generalized propensity score matching to reduce potential biases stemming from differences in observed country characteristics. The results provide strong evidence of self‐selection and heterogeneous food security impacts at different levels of policy intensity. Estimates of the dose‐response functions show that both discrimination against agriculture and large support for it lead to poor performance in the availability, access, and utilization dimensions of food security. JEL codes: C21, F14, F60, O50, Q17.

Price Signals and Supply Responses for Staple Food Crops in Sub-Saharan Africa

We investigate the supply response for main staple food crops in Sub-Saharan Africa over the period 2005−2013 using an innovative dataset recently developed by FAO’s “Monitoring and Analysing Food and Agricultural Policies” (MAFAP) programme. Relying on dynamic panel techniques, we observe that acreage, production and yields respond to price signals, even if with a limited intensity. Moreover, we find that direct price incentives arising from border protection, government interventions in domestic markets, and price shocks at the border stimulate farmers’ supply. We also show that omitting transaction costs from the analysis leads to underestimation of the price elasticity of supply. Conversely, using wholesale instead of farm gate prices as proxy for producer prices leads to overestimation of this price elasticity.

Are EU trade preferences really effective? An impact evaluation assessment of the Southern Mediterranean Countries’ case

Abstract This work assesses the causal impact of the EU trade preferences granted to the Southern Mediterranean Countries (SMCs) in agriculture and fishery products over the period 2004–2014. It overcomes some of the weaknesses of previous assessments and presents several methodological improvements. Firstly, it relies on a continuous treatment – i.e. preferential margins – to capture the ‘average treatment effect’ of trade preferences, rather than on a binary treatment based on dummy variables. Secondly, it uses highly disaggregated data at sectoral level in order to evaluate properly the preferential treatment. Thirdly, it applies a non-parametric matching technique for continuous treatment – specifically, a generalized propensity score matching. The results show, on the one hand, that the impact of the EU preferences is positive and significant on SMCs trade and is better evaluated using impact evaluation techniques. On the other hand, they demonstrate that the relationship between preferences and trade flows is asymmetric and warn against the risk of providing too much of a good thing. These results raise important issues for policy-making. First, they demonstrate that raising the level of preferences is not the solution to foster the SMCs trade towards EU. Second, that the policy-makers should put more emphasis on complementary factors other than trade barriers.

Can a Cereal Export Ban Affect a Net Food-Importing Economy? The Case of Ethiopia

Most governments implemented policies designed to offset the expected negative effects of high food prices of 2007/08 and 2010/11. Among other interventions, net food-importing countries, such as Ethiopia, have introduced a cereal export ban. Several studies have investigated the macroeconomic impacts of export bans on large net exporters of grains. However, only very few country case studies have examined the economy-wide and distributional effects combined. Further, there is a lack of rigorous studies that disentangle the net impact of a cereal export ban when an economy is jointly affected by an external price shock. This paper evaluates the impacts of a border price shock followed by a cereal export ban, and cereal export ban alone in a typical net food-importing country, Ethiopia. Results show that border price shocks can have negative production and supply effects on food, causing strong welfare losses on urban households. However, an export ban can stabilise domestic food prices in the short-run, but cannot erase the price hike. Moreover, the ban discourages cereal production, and reduces rural households’ welfare. As expected, a cereal export ban alone can push domestic food prices down and lead to welfare loss for rural households and the society as a whole while urban households benefit.

Technology adoption and the multiple dimensions of food security: the case of maize in Tanzania

The paper analyses the impact of agricultural technologies on the four pillars of food security for maize farmers in Tanzania. Relying on matching techniques, we use a nationally representative dataset collected over the period 2010/2011 to estimate the causal effects of using improved seeds and inorganic fertilizers on food availability, access, utilization, and stability. Overall, the technologies have a positive and significant impact on food security, but substantial differences between the pillars are observed. Improved seeds show a stronger effect on food availability and access, while - in terms of utilization -- both technologies increase the diet diversity and only improved seeds reduce the dependence on staple food. Finally, improved seeds reduce the household vulnerability while inorganic fertilizers guarantee higher resilience. The study supports the idea that the relationship between agricultural technologies and food security is a complex phenomenon, which cannot be limited to the use of welfare indexes as proxy for food security.

The effect of the National Food Reserve Agency on maize market prices in Tanzania

Tanzanias National Food Reserve Agency has a mandate to ensure food security through procuring, reserving and recycling grain (primarily maize) in a cost†effective manner. This mandate excludes a price stabilization role. Procurement prices, based on production costs, are often set above market prices to encourage production. Several disbursements channels exist: grain provided free or at a discount to targeted vulnerable households; subsidized sales to millers; and sales to prisons or nongovernmental aid programs, typically at market†related prices. Given the perception that these activities are distortive, we use time†series econometrics to model maize price dynamics in select wholesale markets to capture the Agencys market impact. We find that its pricing strategy had an insignificant impact on prices during 2010/11–2014/15 despite a fairly significant presence in at least some regional markets. We recommend that the Agency reconsiders offering a price premium on procured maize or selling maize at discount to millers, as limited market spill†over effects imply the benefits are captured by only a few, even though its practice of providing subsidized or free maize to vulnerable people is not in question. Furthermore, current storage capacity expansion plans are not required and inconsistent with its food security mandate.