Ph.D. Candidate Obie Porteous’ paper on the costs of agricultural trade in sub-Saharan Africa was selected as the best graduate student paper of the 2016 West Coast Trade Workshop. The paper estimates median trade costs in the agricultural sector in sub-Saharan Africa over five times higher than trade costs elsewhere in the world. In counterfactual simulations, Porteous finds that lowering trade costs to match an international benchmark would lead to an over 40% drop in staple food prices in sub-Saharan Africa while dramatically reducing the frequency of extreme price events like the Horn of Africa famine in 2011. The paper goes on to show that most of the gains from lowering trade costs can be achieved by focusing on a handful of well-targeted trade corridors and that widespread agricultural technology adoption in Africa will only increase farmer incomes if trade costs are low.
The title of the paper is High Trade Costs and Their Consequences: An Estimated Dynamic Model of
African Agricultural Storage and Trade .