Kei Kajisa

The Evolution of Rice Price Policies over Four Decades: Thailand, Indonesia and the Philippines

Using time series data over the past four decades, the 1960s to 1990s, this paper examines rice pricing policies in Thailand, Indonesia and the Philippines. It analyses the determinants of the paths along which these policies have moved. While it confirms the findings of previous analyses, that price stabilization has been a major policy achievement, it also reveals that stabilization was not necessarily sustained over the entire survey period. It finds that politico-economic factors—such as entry into the GATT, increase in per capita GDP and achievement of rice self-sufficiency—have been among the determinants of rice pricing policy, but the ways in which these factors have affected policy vary among these countries. Such variation, which previous cross-country studies have not analysed, is a reflection of variations in the roles of rice and in the attitudes of policy-makers in these economies. In its conclusion, this study draws policy implications for each country, taking into account differences in the impact.

Efficiency and equity in groundwater markets: the case of Madhya Pradesh, India

This paper examines efficiency and equity in groundwater markets with special attention to output sharing contracts and to the bargaining relationships between sellers and buyers, using household level data from Madhya Pradesh, India. Regression results find no significant inefficiency on farms managed by output sharing buyers, presumably because optimal input intensities are achieved through effective monitoring and contract adherence mechanisms embedded in long-term and intensive personal relationships between sellers and buyers. As for equity, the finding is that, while output sharing buyers pay higher water prices, the rate of premiums is merely 5 percentage points higher than the informal interest rate that they would have had to carry under other types of groundwater contracts. The results also show that buyers who have access to alternative water sellers pay lower water prices. These findings indicate that if the imperfection of credit and contingent markets in rural areas are taken into account, informal groundwater markets work fairly well in agrarian communities if monitoring and contract adherence mechanisms are embedded and a sufficient number of potential sellers are available.