Establishing the Presence of a Risk Premium in the Cocoa Futures Market: An Econometric Analysis

Previous attempts at identifying and estimating a time-varying risk premium in the cocoa futures market yielded conflicting results. Using a longer series that includes the most recent cash and futures data, the existence of a time-varying risk premium in the cocoa futures market is re-investigated using LM ARCH tests and a Quadratic ARCH in Mean Error Correction Model. In contrast to available research the time series properties of the data are carefully accounted for by employing the most recent econometric techniques in testing for the presence of a risk premium. No evidence is found in support of a positive time-varying [or constant] risk premium in the cocoa futures market at conventional significance levels. The result suggests that cocoa producing countries have one less cost to consider in deciding whether or not to hedge cocoa price risk using futures contracts.Cocoa, Futures markets, time-varying risk premium, error-correction model, Agribusiness, Marketing, M,

Explaining Ghana's Recent Good Cocoa Karma: Smuggling Incentive Argument

The paper contends that the current boom in cocoa exports from Ghana is primarily in response to reversal in price incentives to smuggle Ghana cocoa to La Cote d’Ivoire and not due to productivity gains in the Ghana cocoa supply chain. Using recent data; ADF, Perron and KPSS tests of stationarity; Engle and Granger and Johansen co-integration tests; Granger causality tests; single and vector error correction models; as well as partial adjustment models, we estimate the Ghana cocoa supply response to determine the most pertinent factors that explain the cocoa boom. Different from previous research, the VECM and ECM models are modified to be more reflective of current conditions in the Ghana cocoa sector by including prices of relevant substitutes in cocoa production. Furthermore we carefully account for the time series properties of the data and address endogeneity problems that plague the estimation. For example, in testing for the order of integration of different series, we account for the possible existence of structural breaks. We find that the “price incentive to smuggle” argument adequately explains the current boom in Ghana cocoa supply response. This finding is important because it questions claims in the literature that substantial productivity gains in the cocoa sector in response to good policy is the main reason behind the Ghana cocoa export boom.International Relations/Trade,

An Empirical Analysis of Recent Changes in US Beef Marketing Margins

An Augmented Relative Price Spread (ARPS) model is employed to explain recent changes in real US beef wholesale-retail (WR) and hence farm-retail (FR) marketing margins. It is found that the surge in retail market concentration in 1999 most likely increased retail market oligopsony power relative to wholesale oligopoly power, ultimately changing real US WR beef marketing margins. The finding that higher oligopsony retail market power relative to oligopoly wholesale market power in the US beef industry was most likely responsible for the changes in US WR marketing margins in 1999 is important because it provides an economic justification for policy makers to regulate anticompetitive conduct by beef retailers.Livestock Production/Industries, Marketing,

Is Foreign Aid Beneficial for Sub-Saharan Africa? A Panel Data Analysis

Significant ambiguity surrounds the magnitude and sign of the effect of foreign aid on economic growth. Foreign aid can potentially augment scarce domestic capital to spur growth but foreign aid can also remove positive incentive to build wealth, stalling growth. This paper characterizes the effect of foreign aid on the growth of Sub-Saharan African countries after correcting endogeneity problems that plague the estimation. Foreign aid is found to be growth promoting given good governance and using fixed effects in a static panel framework. Data from twenty-one Sub-Saharan African countries spanning 1995-2003 was used in the estimation. The finding of a significant foreign aid-growth relationship is pertinent because it suggests that increased aid to Sub Saharan Africa is one way to achieve the UN’s Millennium goals. By lobbying for increased foreign aid, advocates are prescribing a necessary albeit insufficient medicine for Sub Saharan Africa’s economic problems.Food Security and Poverty,

Acute childhood diarrhoea in northern Ghana: epidemiological, clinical and microbiological characteristics

<p>Abstract</p> <p>Background</p> <p>Acute diarrhoea is a major cause of childhood morbidity and mortality in sub-Saharan Africa. Its microbiological causes and clinico-epidemiological aspects were examined during the dry season 2005/6 in Tamale, urban northern Ghana.</p> <p>Methods</p> <p>Stool specimens of 243 children with acute diarrhoea and of 124 control children were collected. Patients were clinically examined, and malaria and anaemia were assessed. Rota-, astro-, noro- and adenoviruses were identified by (RT-) PCR assays. Intestinal parasites were diagnosed by microscopy, stool antigen assays and PCR, and bacteria by culturing methods.</p> <p>Results</p> <p>Watery stools, fever, weakness, and sunken eyes were the most common symptoms in patients (mean age, 10 months). Malaria occurred in 15% and anaemia in 91%; underweight (22%) and wasting (19%) were frequent. Intestinal micro-organisms were isolated from 77% of patients and 53% of controls (<it>P </it>< 0.0001). The most common pathogens in patients were rotavirus (55%), adenovirus (28%) and norovirus (10%); intestinal parasites (5%) and bacteria (5%) were rare. Rotavirus was the only pathogen found significantly more frequently in patients than in controls (odds ratio 7.7; 95%CI, 4.2–14.2), and was associated with young age, fever and watery stools. Patients without an identified cause of diarrhoea more frequently had symptomatic malaria (25%) than those with diagnosed intestinal pathogens (12%, <it>P </it>= 0.02).</p> <p>Conclusion</p> <p>Rotavirus-infection is the predominant cause of acute childhood diarrhoea in urban northern Ghana. The abundance of putative enteropathogens among controls may indicate prolonged excretion or limited pathogenicity. In this population with a high burden of diarrhoeal and other diseases, sanitation, health education, and rotavirus-vaccination can be expected to have substantial impact on childhood morbidity.</p

Establishing the Presence of a Risk Premium in the Cocoa Futures Market: An Econometric Analysis

Previous attempts at identifying and estimating a time-varying risk premium in the cocoa futures market yielded conflicting results. Using a longer series that includes the most recent cash and futures data, the existence of a time-varying risk premium in the cocoa futures market is re-investigated using LM ARCH tests and a Quadratic ARCH in Mean Error Correction Model. In contrast to available research the time series properties of the data are carefully accounted for by employing the most recent econometric techniques in testing for the presence of a risk premium. No evidence is found in support of a positive time-varying [or constant] risk premium in the cocoa futures market at conventional significance levels. The result suggests that cocoa producing countries have one less cost to consider in deciding whether or not to hedge cocoa price risk using futures contracts

Explaining Ghana's Recent Good Cocoa Karma: Smuggling Incentive Argument

The paper contends that the current boom in cocoa exports from Ghana is primarily in response to reversal in price incentives to smuggle Ghana cocoa to La Cote d’Ivoire and not due to productivity gains in the Ghana cocoa supply chain. Using recent data; ADF, Perron and KPSS tests of stationarity; Engle and Granger and Johansen co-integration tests; Granger causality tests; single and vector error correction models; as well as partial adjustment models, we estimate the Ghana cocoa supply response to determine the most pertinent factors that explain the cocoa boom. Different from previous research, the VECM and ECM models are modified to be more reflective of current conditions in the Ghana cocoa sector by including prices of relevant substitutes in cocoa production. Furthermore we carefully account for the time series properties of the data and address endogeneity problems that plague the estimation. For example, in testing for the order of integration of different series, we account for the possible existence of structural breaks. We find that the “price incentive to smuggle” argument adequately explains the current boom in Ghana cocoa supply response. This finding is important because it questions claims in the literature that substantial productivity gains in the cocoa sector in response to good policy is the main reason behind the Ghana cocoa export boom

An Empirical Analysis of Recent Changes in US Beef Marketing Margins

An Augmented Relative Price Spread (ARPS) model is employed to explain recent changes in real US beef wholesale-retail (WR) and hence farm-retail (FR) marketing margins. It is found that the surge in retail market concentration in 1999 most likely increased retail market oligopsony power relative to wholesale oligopoly power, ultimately changing real US WR beef marketing margins. The finding that higher oligopsony retail market power relative to oligopoly wholesale market power in the US beef industry was most likely responsible for the changes in US WR marketing margins in 1999 is important because it provides an economic justification for policy makers to regulate anticompetitive conduct by beef retailers

Is Foreign Aid Beneficial for Sub-Saharan Africa? A Panel Data Analysis

Significant ambiguity surrounds the magnitude and sign of the effect of foreign aid on economic growth. Foreign aid can potentially augment scarce domestic capital to spur growth but foreign aid can also remove positive incentive to build wealth, stalling growth. This paper characterizes the effect of foreign aid on the growth of Sub-Saharan African countries after correcting endogeneity problems that plague the estimation. Foreign aid is found to be growth promoting given good governance and using fixed effects in a static panel framework. Data from twenty-one Sub-Saharan African countries spanning 1995-2003 was used in the estimation. The finding of a significant foreign aid-growth relationship is pertinent because it suggests that increased aid to Sub Saharan Africa is one way to achieve the UN’s Millennium goals. By lobbying for increased foreign aid, advocates are prescribing a necessary albeit insufficient medicine for Sub Saharan Africa’s economic problems

Self-Reported Cannabis Use and HIV Viral Control among Patients with HIV Engaged in Care: Results from a National Cohort Study

Background: The association between cannabis use and HIV-1 RNA (viral load) among people with HIV (PWH) engaged in care is unclear. Methods: We used data collected from 2002 to 2018 on PWH receiving antiretroviral therapy (ART) enrolled in the Veterans Aging Cohort Study. Generalized estimating equations were used to estimate associations between self-reported past-year cannabis use and detectable viral load (&ge;500 copies/mL), with and without adjustment for demographics, other substance use, and adherence. Results: Among 2515 participants, 97% were male, 66% were Black, the mean age was 50 years, and 33% had detectable HIV viral load at the first study visit. In unadjusted analyses, PWH with any past-year cannabis use had 21% higher odds of a detectable viral load than those with no past-year use (OR = 1.21; 95% CI, 1.07&ndash;1.37). However, there was no significant association between cannabis use and viral load after adjustment. Conclusions: Among PWH engaged in care and receiving ART, cannabis use is associated with decreased adherence in unadjusted analyses but does not appear to directly impact viral control. Future studies are needed to understand other potential risks and benefits of cannabis use among PWH