Estimation of price policies in Senegal An empirical test of cooperative game theory

Abstract

A game-theoretic framework rationalizes the political economy of food and agricultural price policies in Senegal. Policies are the outcome of a cooperative bargaining process among three archetypal players: a farmer growing cash and staple crops, an urban consumer buying imported cereals, and a government marketing board intervening in agricultural markets. The game is estimated and the bargaining strength of the players is recovered. The axioms underlying the game are tested to discriminate among various bargaining game solutions. The symmetry and efficiency axioms are rejected.