TITLE:
Do Insect and Mold Damage Affect Maize Prices in Africa? Evidence from Malawi
AUTHORS:
Michael Jones, Corinne Alexander, Nicole Olynk Widmar, Jacob Ricker-Gilbert, Jess M. Lowenberg-DeBoer
KEYWORDS:
Insect Damaged Maize, Post-Harvest Losses, Choice Experiments, Attribute Non-Attendance, Sub-Saharan Africa
JOURNAL NAME:
Modern Economy,
Vol.7 No.11,
September
26,
2016
ABSTRACT: Economic losses to stored grain can potentially come
from both quantity losses and quality losses in the form of price discounts for
damage from insects and mold. This article uses choice experiments conducted
with physical samples of maize to estimate discounts for damaged grain among
maize traders in Malawi. Using the Equality Constrained Latent Class method to
correct for non-attendance to the price attribute, we find that traders place a
statistically and economically significant discount on insect-damaged maize. We
estimate that a 1% increase in maize damage reduces the price of maize by 2.8%
to 3.6%, depending on damage level. We discuss the implications of these
results for farmers’ incentives to adopt improved storage technologies that can
reduce post-harvest losses.