Weather Shocks and Spatial Market Efficiency: Evidence from Mozambique
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Weather Shocks and Spatial Market Efficiency : Evidence from Mozambique. / Salazar, César; Ayalew, Hailemariam; Fisker, Peter Kielberg.
In: Journal of Development Studies, Vol. 55, No. 9, 2019, p. 1967-1982.Research output: Contribution to journal › Journal article › Research › peer-review
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TY - JOUR
T1 - Weather Shocks and Spatial Market Efficiency
T2 - Evidence from Mozambique
AU - Salazar, César
AU - Ayalew, Hailemariam
AU - Fisker, Peter Kielberg
PY - 2019
Y1 - 2019
N2 - The aim of this paper is to study the association between weather shocks (droughts and floods) and agricultural market performance in Mozambique. To do so, we employ a dyadic regression analysis on monthly maize prices, transport costs, and spatial identification of markets as well as droughts and flooded areas. Our estimates show that, while a drought reduces price differences between markets, price dispersion increases during flood periods, an effect that is mainly driven by increases in transport costs. Finally, floods are found to affect price differences more if markets are closer to each other and if the road infrastructure quality is poor. An important implication of our results is that markets show some degree of efficiency during supply shock periods in Mozambique. However, spatial market integration continues to be insufficient, probably due to high transfer costs.
AB - The aim of this paper is to study the association between weather shocks (droughts and floods) and agricultural market performance in Mozambique. To do so, we employ a dyadic regression analysis on monthly maize prices, transport costs, and spatial identification of markets as well as droughts and flooded areas. Our estimates show that, while a drought reduces price differences between markets, price dispersion increases during flood periods, an effect that is mainly driven by increases in transport costs. Finally, floods are found to affect price differences more if markets are closer to each other and if the road infrastructure quality is poor. An important implication of our results is that markets show some degree of efficiency during supply shock periods in Mozambique. However, spatial market integration continues to be insufficient, probably due to high transfer costs.
U2 - 10.1080/00220388.2018.1528352
DO - 10.1080/00220388.2018.1528352
M3 - Journal article
AN - SCOPUS:85054589094
VL - 55
SP - 1967
EP - 1982
JO - Journal of Development Studies
JF - Journal of Development Studies
SN - 0022-0388
IS - 9
ER -
ID: 214132710