Transmission of Rice Prices from Thailand into West African Markets: The Case of Benin, Mali, and Senegal

Transmission of Rice Prices from Thailand into West African Markets: The Case of Benin, Mali, and Senegal

Author: 
Fiamohe, Rose
Publisher: 
Taylor & Francis Group
Date published: 
2015
Record type: 
Responsibility: 
Alia, Didier Y., jt. author
Bamba, Ibrahima, jt. author
Diagne, Aliou, jt. author
Amovin-Assagba, Eyram, jt. author
Journal Title: 
Journal of African Business
Source: 
Journal of African Business, Vol 16, No. 1-2, January-August 2015, pp. 128-143
Abstract: 

The integration of West African rice market to the world market is assessed in order to derive the implication for food security. To this end, the transmission of rice price changes on the world market to selected markets in West Africa was examined to test for the presence of transaction costs. Using the two-regime threshold cointegration procedure on monthly price data, evidence in support of the hypothesis of asymmetric price transmission was found between Thailand and some West African markets. Price increases on the world market were more quickly transmitted to domestic price than were price decreases in Benin and Mali, suggesting short-run dynamic inefficiencies and the presence of transaction costs. In Senegal, the adjustment was linear, suggesting greater integration with the world rice market. The results suggest that West African governments should design and implement adequate policies to develop the domestic rice sector, improve market infrastructures in order to reduce their country dependency to international markets and ensure food security.

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Country focus: 

CITATION: Fiamohe, Rose. Transmission of Rice Prices from Thailand into West African Markets: The Case of Benin, Mali, and Senegal . : Taylor & Francis Group , 2015. Journal of African Business, Vol 16, No. 1-2, January-August 2015, pp. 128-143 - Available at: http://library.au.int/transmission-rice-prices-thailand-west-african-markets-case-benin-mali-and-senegal-0