Price Elasticity of Supply of Tanzania’s Major Export Crops

This paper presents an estimate of the price elasticity of supply for five major export crops in Tanzania – coffee (robusta and arabica), cotton, cashew nuts, tea and tobacco (flue-cured and fire cured) – based on data for the period 1964-1984. The results indicate that although there are many factors determining production, producer price remains the single most important variable. The price elasticities range from 0.12 for robusta coffee to 0.79 for flue-cured tobacco. The results also suggest that there is smuggling of coffee arabica from Tanzania to Kenya induced by the real producer price difference. App., bibliogr., notes.

Title: Price Elasticity of Supply of Tanzania’s Major Export Crops
Author: Mshomba, Richard E.
Year: 1989
Periodical: Eastern Africa Economic Review
Volume: 5
Issue: 1
Period: June
Pages: 9-23
Language: English
Notes: biblio. refs., ills.
Geographic terms: Tanzania
East Africa
Abstract: This paper presents an estimate of the price elasticity of supply for five major export crops in Tanzania – coffee (robusta and arabica), cotton, cashew nuts, tea and tobacco (flue-cured and fire cured) – based on data for the period 1964-1984. The results indicate that although there are many factors determining production, producer price remains the single most important variable. The price elasticities range from 0.12 for robusta coffee to 0.79 for flue-cured tobacco. The results also suggest that there is smuggling of coffee arabica from Tanzania to Kenya induced by the real producer price difference. App., bibliogr., notes.