Central Data Catalog

Citation Information

Type Journal Article - THE WORLD BANK ECONOMIC REVIEW
Title Household welfare and the pricing of cocoa and coffee in Cote d'Ivoire: lessons from the Living Standards Surveys
Author(s)
Volume 7
Issue 3
Publication (Day/Month/Year) 1993
Page numbers 293-318
URL http://www.princeton.edu/~deaton/downloads/Household_Welfare_and_the_Pricing_of_Cocoa.pdf
Abstract
Cocoa and coffee are the most important crops in Cote d'Ivoire. Until recently, the difference between world and administered producer prices provided an importantsource of government revenue. As a result of a continued decline of world prices of bothcrops, however, the Ivoirien government was forced to cut producer prices in half. Because 40 percent of Ivoirien households grow either cocoa or coffee, this cut can beexpected to have a considerable impact on the welfare level of these housebolds. We usethe 1985 Living Standards Measurement Survey to estimate the welfare effects of producer price cbanges for Ivoirien households, permitting an evaluation of the proba-ble consequences of the recent price cut. Using nonparametnc econometric techniques,we find that, although many households will suffer losses of income, the cuts will not have adverse distributional effects: cocoa and coffee farmers are scattered throughout the income distribution, but most are concentrated in the middle

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