Do the Poor Pay More for Maize in Malawi?

Mussa, Richard (2014): Do the Poor Pay More for Maize in Malawi?

Abstract

The paper uses data from the Third Integrated Household Survey to examine whether or not the poor pay more for maize in Malawi. Two approaches are adopted; an indirect approach which is based on quantity discounting, and a direct approach which is based the relationship between an expensiveness variable and household consumption expenditure. The paper finds that the poor in rural and urban areas pay more for maize. This evidence of a poverty penalty in the maize market is not sensitive to method used. It is found that the poor pay more for maize irrespective of when the maize is purchased. Thus, seasonality does not seem to be behind the observed poverty penalty. The paper also finds that the poverty penalty varies with seasonality.The poverty penalty is significantly more pronounced in the postharvest period when maize is in abundance; it is however reduced in the lean season.

• Item Type: MPRA Paper
• Language: English
• Keywords: Poverty penalty; quantity discounting; Malawi
• Subjects: D - Microeconomics > D1 - Household Behavior and Family Economics

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