Introduction and Overview
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that provide nonprice support were more autonomous and efficient. In cases in which the state supports producers (or at least is not antagonistic to them), there is a greater ability to develop better institutional structures to provide nonprice support. In these cases, shocks to the sector can also be more easily accommodated. In the five cases considered to have failed in sustaining the initial supply response after reforms, nonprice support to agriculture was not increased or even maintained. Although difficult to prove conclusively, the existence of more autonomous and efficient nonprice support mechanisms could be an artifact of the lack of conflict around these commodities. 4. Finally, not only price shocks, but also nonprice shocks, drive the sustainability of a reform’s success. Nonprice shocks can be technological changes, diseases, or weather-related developments. One of the most important technological innovations over the last two decades has been the development of genetically engineered seeds for cotton, which is one of the main export crops in SSA. The inability to adopt Bt cotton has reduced the profitability of cotton production in SSA tremendously in the face of declining world prices and lowered output growth rates. Post-reform agricultural production performance in SSA has also been severely affected by diseases. There are also other negative developments, such as diseases in coffee in Uganda and cashews in Mozambique and Tanzania. The coffee sector in this case has failed to develop necessary vertical arrangements to effectively fight coffee wilt disease, which has reversed the production growth experienced immediately after the reforms. Similarly, cashew diseases that require pesticide applications, new varieties, and replanting could not be effectively eliminated by the existing support institutions.
Price Behavior Although international prices (expressed in U.S. dollars) for the individual commodities covered in this volume have slightly different turning points, they follow a similar pattern. One large price cycle has occurred since 1990. Prices start increasing during the early 1990s, then decreased dramatically after the Asian crisis. They then began increasing again in the early 2000s, reaching their peak in 2008, the last year of the sample for this volume. All of the reforms in SSA analyzed in this volume were undertaken during the early 1990s. This was a period of generally increasing prices, which contributed to the initial supply response observed after the