An innovation platform for institutional change in Ghana's cocoa sector

Abstract

Cocoa is a major source of employment, smallholder farmers' incomes, and export revenue in Ghana. However, by 2010 institutional constraints throughout the value chain were failing to sustain bean quality and cocoa production. A national-level innovation platform, comprising key public and private actors in the cocoa sector, was established in 2010 to analyse and act to address this concern. The members' initial inquiries revealed that: farmers indirectly were paying for the national mass spraying and Hi-Tech input programmes, both provided free at the point of delivery. As the largest components in the cost structure, these programmes to a large extent accounted for the low price paid to farmers for their beans; a volatile exchange rate regime meant that often the prevailing rate was not equal to its equilibrium level; policies that heavily taxed cocoa were destroying farmers' expectation of long-term profitability. This paper draws on data recorded from the beginning 2009 to end 2013 by means of theory-guided process tracing (TGPT), to show how the platform contributed to increased prices for farmers, to subsequent reform of the input supply arrangements, and to changes to the mass spraying programme. The key causal mechanisms identified are policy learning and progressive amendment of existing institutions. The paper concludes by drawing lessons for the role of an innovation platform.