Analysis of Price Volatility and Implications for Price Stabilization Policies in Mozambique
Date
2014
Authors
Ngare, Lucy
Simtowe, Franklin
Massingue, Jaquelino
Journal Title
Journal ISSN
Volume Title
Publisher
International Knowledge Sharing Platform
Abstract
High food price instability is one of the major risks facing agricultural households from developing countries.
Resulting from agronomic factors as well as the historically low levels of world grain stocks and climate change,
increased food price volatility has attracted renewed interest among policy experts in identifying appropriate
policy instruments to counter its effects. This paper applies the GARCH model to data from twelve maize
markets in Mozambique to estimate price seasonality and volatility. The results reveal the presence of
seasonality, and high volatility. There is scope for improving price stability through the use of both market and
non-market based price stabilization interventions that encourage investments in market infrastructure such as
roads, warehouses and a market information system; institutions such as warehouse receipt system, credit and
insurance; maintaining a strategic reserve and reduced tariffs and food-for-work programmes.
Description
A research article published in European Journal of Business and Management
Keywords
Price volatility, Maize, GARCH, Mozambique
Citation
Ngare, L., Simtowe, F., & Massingue, J. (2014). Analysis of price volatility and implications for price stabilization policies in mozambique. European journal of business and management, 6(22), 160-173.