Competition Policies and Consumer Welfare

Competition Policies and Consumer Welfare

Corporate Strategies and Consumer Prices in Developing Countries

Edited by Lahcen Achy and Susan Joekes

The fundamental goal of competition law is to support productivity and innovativeness; in fact, the short-term effect of enforcement actions is often a reduction in product prices. This book reports the findings of consumer market studies into a range of goods and services in developing countries in Africa, Asia and Latin America. It finds a pervasive lack of competition in those markets, which not only reduces the standard of living of consumers, including poor and vulnerable groups, but also softens the incentives on firms to improve the efficiency of their operations and the quality of their products

Chapter 4: The market in cereals in Mali

Oumar Idriss Berthe, Massa Coulibaly, Salifou B. Diarra and Martin Sidibe

Subjects: development studies, development economics, law and development, economics and finance, competition policy, political economy, law - academic, competition and antitrust law

Extract

Cereal products play a key role in Mali, not just through their contribution to the agricultural value-added and employment of the population, but also in terms of their share of household expenditure. The challenge of securing a regular supply of grain and ensuring that markets operate in a competitive manner are major concerns for the government. Apart from their economic significance, these issues have an important social and political dimension. To this end, food security has been historically a main objective of Mali’s agricultural policy and a range of approaches have been adopted to achieve this goal. Between the 1960s and the 1980s, the government’s policy was interventionist and prices were set by the state through Mali’s Agency for Agricultural Produce (OPAM), which was also responsible for trade in cereals. This policy was designed to supply grain to urban areas at low cost while also offering incentivizing prices to farmers. However, the limitations of this approach became apparent from the 1980s onwards, when there was a drop in cereal production, a shortfall in supply for domestic consumption and a surge in OPAM’s accumulated deficit.

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