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Agricultural Commodity Prices and Household Welfare in Ghana
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This paper accesses the impact of changes in prices§of cocoa, maize, and rice, on household welfare and§poverty in Ghana during the 1990s. We use§nonparametric analysis to assess the short-run§impacts on income and the impacts on consumption§first separately and then aggregately. Distributional§impacts are also estimated by replicating the same§analysis for households by income decile. Finally, an§econometric analysis is used to check the long-run§relationship between prices and welfare, while§controlling for other factors. The results from the§nonparametric and parametric analysis are consistent§with each other. We find that the rising cocoa price§had a big positive effect on household welfare in§Ghana. Predictably, net sellers and net buyers were§affected differently by the falling prices of maize§and rice. However, these impacts were limited.
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