Abstract
This study examines the effect of previous price and climatic variables on maize supply in Ghana. For this purpose, two separate approaches are used: (i) a lag model using the OLS technique and (ii) a quantile regression approach. Results from the lag model indicates that an increase in previous year maize price and previous growing season temperature positively affect current year maize supply. However, an increase in previous growing season rainfall negatively affects current year maize supply. The quantile regression results show that maize supply responds differently to previous maize price and climatic variables across the different quantiles of crop area distribution.
Highlights
The economies of most countries in Sub-Saharan Africa depend heavily on agriculture which provides the main source of food income and employment especially to the rural population
The objective of this study is to study the effect of previous maize price and climatic variables on maize supply in Ghana
A lag model using the OLS technique and the quantile regression approach were employed in the study
Summary
The economies of most countries in Sub-Saharan Africa depend heavily on agriculture which provides the main source of food income and employment especially to the rural population. In order to meet the rising demand and bring about sustained and balanced economic growth, it is paramount to understand the effect of prices on production. Non-price factors such as good weather conditions and improving technological and institutional frame leads to shifts in the supply function. This is so, for developing countries where various studies (Patel and Singh, 1994, Dixit, et al, 1998) have shown that farmers response behaviour are influenced more by non-price factors. Among the staples grown in Ghana, maize has been identified as one of the most important within the grains and cereals family It is cultivated on more than, 991,661 hectares and across all agro ecological regions in Ghana (Statistics, Research and Information Directorate [SRID], 2010)
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