• TABLE OF CONTENTS
HIDE
 Copyright
 Front Cover
 Title Page
 Abstract
 Acknowledgement
 Table of Contents
 List of Tables
 List of Figures
 Country setting
 Rice consumption and supply characteristics:...
 Conceptual framework and analytical...
 Analytical procedures and empirical...
 Policy implications, recommendations...
 Reference






Group Title: CTA report - Center for Subtropical Agriculture - 3
Title: Agricultural diversification and rice import substitution policies in the Ivory Coast, 1950-1972
CITATION PAGE IMAGE ZOOMABLE PAGE TEXT
Full Citation
STANDARD VIEW MARC VIEW
Permanent Link: http://ufdc.ufl.edu/UF00053943/00001
 Material Information
Title: Agricultural diversification and rice import substitution policies in the Ivory Coast, 1950-1972
Series Title: CTA report
Physical Description: v, 80 p. : ill. ; 28 cm.
Language: English
Creator: Adama, Bakayoko, 1949-
Davis, C. G ( Carlton George ), 1936-
Andrew, Chris O
University of Florida -- Center for Tropical Agriculture
University of Florida -- Food and Resource Economics Dept
University of Florida -- Center for African Studies
Publisher: Center for Tropical Agriculture, International Programs, Institute of Food and Agricultural Sciences, University of Florida :
in cooperation with Food and Resource Economics Dept. and Center for African Studies, University of Florida
Place of Publication: Gainesville Fla
Publication Date: 1979
 Subjects
Subject: Agriculture -- Economic aspects -- Côte d'Ivoire   ( lcsh )
Rice -- Côte d'Ivoire   ( lcsh )
Rice trade -- Côte d'Ivoire   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
bibliography   ( marcgt )
non-fiction   ( marcgt )
 Notes
Bibliography: Includes bibliographical references (p. 77-80)
Statement of Responsibility: by B. Adama, C.G. Davis, C.O. Andrew.
Funding: Electronic resources created as part of a prototype UF Institutional Repository and Faculty Papers project by the University of Florida.
 Record Information
Bibliographic ID: UF00053943
Volume ID: VID00001
Source Institution: University of Florida
Holding Location: University of Florida
Rights Management: All rights reserved, Board of Trustees of the University of Florida
Resource Identifier: aleph - 001853741
oclc - 25656956
notis - AJS8103

Table of Contents
    Copyright
        Copyright
    Front Cover
        Front Cover
    Title Page
        Title Page
    Abstract
        Abstract
    Acknowledgement
        Acknowledgement
    Table of Contents
        Page i
        Page ii
    List of Tables
        Page iii
        Page iv
    List of Figures
        Page v
    Country setting
        Page 1
        Physical and demographic characteristics
            Page 1
            Page 2
            Page 3
        Agriculture and the national economy
            Page 4
            Page 5
            Page 6
            Page 7
            Page 8
            Page 9
            Page 10
            Page 11
            Page 12
            Page 13
            Page 14
            Page 15
            Page 16
            Page 17
            Page 18
            Page 19
            Page 20
        Problem statement
            Page 21
            Page 22
            Page 23
            Page 24
        Objectives of the study
            Page 25
        Data base
            Page 26
    Rice consumption and supply characteristics: A review
        Page 26
        Structural setting
            Page 26
        Structural changes in food producing areas
            Page 27
        Structural changes in urban and plantation labor force
            Page 27
            Page 28
        Consumption and supply characteristics: Literature review
            Page 29
            Page 30
            Page 31
            Page 32
            Page 33
            Page 34
    Conceptual framework and analytical models
        Page 35
        Page 36
        Conceptual framework
            Page 35
            Some relevant hypotheses and theory relating to rice production and consumption
                Page 35
            Factor-factor substitution
                Page 37
            Commodity-commodity substitution
                Page 38
                Page 39
                Cardinal utility theory
                    Page 40
                Ordinal utility theory
                    Page 41
                    Page 42
        Analytical models
            Page 43
            Objective 2
                Page 44
            Objective 4
                Page 45
    Analytical procedures and empirical results
        Page 46
        Procedure adjustments
            Page 46
            Page 47
            Page 48
            Page 49
        Empirical results
            Page 50
            Relative prices, production, and resource allocation
                Page 50
                Page 51
                Page 52
                Page 53
                Page 54
                Page 55
            Growth in rice demand
                Page 56
                Page 57
                Page 58
            Rice supply and demand equilibrium
                Page 59
                Page 60
            Rice substitutes and complements
                Page 61
                Page 62
    Policy implications, recommendations and conclusions
        Page 63
        Policy implications
            Page 63
            Dependable and remunerative price relationships
                Page 64
            Structural bottlenecks in the farming system
                Page 64
                Page 65
            Resource allocation
                Page 66
            Product substitutability
                Page 67
        Recommendations
            Page 68
            Dependable and profitable pricing system
                Page 68
                Page 69
            An intensified farming sytem
                Page 70
            Subsectoral investment levels
                Page 71
            Research and development
                Page 71
                Transportation and storage facilities
                    Page 72
                Efficient marketing system
                    Page 73
            Commodity substitution and nutritional goals
                Page 74
        Conclusions
            Page 75
            Page 76
    Reference
        Page 77
        Page 78
        Page 79
        Page 80
Full Text





HISTORIC NOTE


The publications in this collection do
not reflect current scientific knowledge
or recommendations. These texts
represent the historic publishing
record of the Institute for Food and
Agricultural Sciences and should be
used only to trace the historic work of
the Institute and its staff. Current IFAS
research may be found on the
Electronic Data Information Source
(EDIS)

site maintained by the Florida
Cooperative Extension Service.






Copyright 2005, Board of Trustees, University
of Florida






























Center for Tropical Agriculture
International Programs
Institute of Food and Agricultural Sciences
University of Florida
Gainesville, Florida 32611


in cooperation with















AGRICULTURAL DIVERSIFICATION AND RICE IMPORT

SUBSTITUTION POLICIES IN THE IVORY COAST,

1950 1972

by

B. Adama, C. G. Davis, C. 0. Andrew


CTA Report 3


November 1979


Center for Tropical Agriculture
International Programs
Institute of Food and Agricultural Sciences
University of Florida
Gainesville, Florida 32611




in cooperation with




Food and Resource Economics Department
and
Center for African Studies
University of Florida















ABSTRACT


This study focuses on the agricultural sector of the Ivory Coast
in general and the rice subsector in particular. Rice is a high
demand commodity and a major wage good. Although rice production is
technically feasible in the Ivory Coast, government rice self-
sufficiency and import substitution policies have consistently failed
to meet targeted objectives. The objectives are: (a) to estimate
the impact of producer prices of rice and other relevant variables on
domestic rice production, (b) to determine key factors associated
with increases in domestic demand for rice, (c) to assess differences
between aggregate domestic rice supply and demand growth rates, and
(d) to determine whether the 1950-1972 fluctuations in domestic rice
production and imports are associated with commodity substitution
patterns.
Findings reveal that the own-lag price of rice to producer, the
return to export crops, and the area under export crop cultivation
were having adverse effects on domestic rice production. The hec-
tareage devoted to rice cultivation and other variables such as
fertilizer, time trend and rainfall were exhibiting positive effects
on domestic rice production. Annual growth rates of demand for rice
were found to be highly and positively correlated to the per capital
income component of the demand shifter and there was a general failure
of domestic rice production to meet the growing effective demand for
rice. Yam was the only commodity substitute for rice.
The key implications identified were: (a) a poor pricing system
to rice producer, (b) a competitive relationship between export crops
acreage and rice acreage, (c) a relatively low level of investment
in the rice subsector, and (d) the shift of consumption patterns
from a high nutrient content food commodity to a poor protein valued
commodity.
Key words: Ivory Coast, agricultural sector, rice subsector,
rice self-sufficiency, import substitution, pricing policy, agricul-
tural development, development policy.
















ACKNOWLEDGMENTS


The authors wish to thank the Ivorian Center for Economic and

Social Research (CIRES) of National University of the Ivory Coast

and the Ford Foundation for Mr. Adama's support while pursuing the

M. S. degree at the University of Florida. This report is based in

part on Mr. Adama's thesis. The assistance of Drs. W. W. McPherson

and J. S. Dinning is gratefully acknowledged for their constructive

comments during the research phase of the report. Appreciation is

also extended to Drs. E. H. Gilbert and J. R. Simpson for their

comments on an earlier version of the manuscript. Special acknow-

ledgments are extended to Jean Chataigner and Jacques Pegatienan

for their support of this project. The authors, however, are solely

responsible for any errors or deficiencies in the report.
















TABLE OF CONTENTS


Page


LIST OF TABLES . . . . .

LIST OF FIGURES. . . . . .

COUNTRY SETTING. . . . . .

Physical and Demographic Characteristics. .
Agriculture and the National Economy. .
Problem Statement . . . .
Objectives of the Study . . .
Data Base . . . . .

RICE CONSUMPTION AND SUPPLY CHARACTERISTICS:
A REVIEW. . . . . .


Structural Setting. . . . . ... 26
Structural Changes in Food Producing Areas. . .. .27
Structural Changes in Urban and Plantation
Labor Force. . . . .... .27
Consumption and Supply Characteristics:
Literature Review. . . . ... 29

CONCEPTUAL FRAMEWORK AND ANALYTICAL MODELS . ... .35


Conceptual Framework. . . . .
Some Relevant Hypotheses and Theory Relating
to Rice Production and Consumption. .
Factor-Factor Substitution . . .
Commodity-Commodity Substitution . .
Cardinal utility theory . . .
Ordinal utility theory. . . .
Analytical Models . . . . .
Objective 1. . . . . .
Objective 2. . . . . .
Objective 3. . . . . .
Objective 4 . . . .

ANALYTICAL PROCEDURES AND EMPIRICAL RESULTS. . .

Procedure Adjustments . . . .
Empirical Results . . . . .


S 35

S 35
S 37
38
4o
. 44
41
43
.43
S 44
44
S45

46
S 46

S 50
* 50


. iii


. . v

. . 1


- I









TABLE OF CONTENTS (Continued)
Page
Relative Prices, Production, and Resource
Allocation . . . . .. .50
Growth in Rice Demand . . . ... .56
Rice Supply and Demand Equilibrium. . . .59
Rice Substitutes and Complements. . .. .61

POLICY IMPLICATIONS, RECOMMENDATIONS AND CONCLUSIONS. . .63

Policy Implications. . . . . .63
Dependable and Remunerative Price Relationships 64
Structural Bottlenecks in the Farming System. .. .64
Resource Allocation . . . ... ..66
Product Substitutability. . . ... 67
Recommendations . . . . ... 68
Dependable and Profitable Pricing System. ... ..68
An Intensified Farming System . .... 70
Subsectoral Investment Levels . . ... 71
Research and development . . ... .71
Transportation and storage facilities. . .72
Efficient marketing system . ... .73
Commodity Substitution and Nutritional Goals. .74
Conclusions. . . . ... ..... .75

REFERENCES. . . . . ... ...... .77












LIST OF TABLES


Table Page

1 Trends and allocation of Gross Domestic Product of the
Ivory Coast, by sector, 1960-1972 . .. . 6

2 Share of export commodities as percentage of total
agricultural export earnings, Ivory Coast, selected years,
1952-1972 . . . .... . ... 7

3 Value at price to .producer of main domestic and export
cash crops, selected years, 1960-1972 ........... 9

4 Trend and allocation of the revenue to producer to main
export crops, selected years, 1960-1972 . . 11

5 Production and import trends for rice, Ivory Coast,
1950-1972 .... . ... ... . . 15

6 Domestic rice production, hectareage under cultivation and
yields, Ivory Coast, 1950-1972. . . ... 17

7 Area under selected non-food cash crops, Ivory Coast,
1960-1972 . . . . ... .. ... 20

8 Evolution of the Ivory Coast balance of trade, 1951-
1972. . . . . . . 24

9 Estimates of urban, rural and total population, Ivory
Coast, selected years, 1972-1990. . . ... 28

10 Nutrient composition per 100 grams of selected agricul-
tural commodities, calories, protein, and fat . .. .31

11 Import quantity and value of major grain cereals, Ivory
Coast, 1960-1972. . . . .... .... .. 34

12 Average consumer price indices for European family,
Ivory Coast, 1962-1972. ... .. .......... 48

13 Average consumer price indices for African family,
Ivory Coast, 1960-1972. . . .. ... 49

iii







Table Page

14 Five month average rainfalls, selected rice growing
areas, Ivory Coast, 1960-1972 . .... ... 51

15 Average prices to producers for selected export cash
crops and rice, Ivory Coast, 1960-1972. . . 53

16 Differences between aggregate domestic supply and demand
growth rates for rice, Ivory Coast, 1960-61 to 1972-73. 58

17 Estimates of average population, average per capital
income, aggregate demand growth rates, income elasticity,
Ivory Coast, 1960-1972. ... . . . 60















LIST OF FIGURES

Figure Page

1 Location of the Ivory Coast .......... . 2

2 Agro-ecological zones and major rivers of the Ivory
Coast . . . . . . 3

3 Trends in rice production, imports and total quantity
available, Ivory Coast, 1960-1972 . . .. 18

4 Trend in food production and population in Africa
(South Africa excluded), 1960-1969. . . ... 32

5 Trend of the rice annual growth demand rate, Ivory
Coast, 1960-61 to 1972-73 . .. .... 57















AGRICULTURAL DIVERSIFICATION AND RICE IMPORT SUBSTITUTION
POLICIES IN THE IVORY COAST, 1950-1972


B. Adama, C. G. Davis and C. O. Andrew


COUNTRY SETTING

Physical and Demographic Characteristics


The Ivory Coast lies within the frontiers delineated by the
former french colonial administration in 1904. These frontiers
were the result of aggressive implementation of general policy
for organizing and institutionalizing the French Territories in
West Africa. With an area of 325,770 square kilometers (125,750
square miles), roughly the size of the state of New Mexico, the
Ivory Coast is bordered by Ghana on the east, Upper Volta and Mali
on the north, and Liberia and Guinea on the west (Fig. 1).
Within the country itself the land is differentiated by agro-
ecological zones of natural vegetation. The deep southern region
is densely forested, particularly in the southwest. The mideastern
and midwestern regions are covered with tropical forest. The central
and northern regions of the country exhibits decreasing levels of
vegetation as one moves to the north (Fig. 2). The average annual
rainfall is 127 centimeters (about 50 inches). The relative
humidity averages about 80 percent in the south and ranges from 20
to 60 percent in the north.




B. ADAMA is an Ivorian CIRES-Ford Foundation Fellow in food
and resource economics at the University of Florida. C. G. DAVIS
and C. 0. ANDREW are associate professor and professor, respectively,
of food and resource economics at the University of Florida.















AGRICULTURAL DIVERSIFICATION AND RICE IMPORT SUBSTITUTION
POLICIES IN THE IVORY COAST, 1950-1972


B. Adama, C. G. Davis and C. O. Andrew


COUNTRY SETTING

Physical and Demographic Characteristics


The Ivory Coast lies within the frontiers delineated by the
former french colonial administration in 1904. These frontiers
were the result of aggressive implementation of general policy
for organizing and institutionalizing the French Territories in
West Africa. With an area of 325,770 square kilometers (125,750
square miles), roughly the size of the state of New Mexico, the
Ivory Coast is bordered by Ghana on the east, Upper Volta and Mali
on the north, and Liberia and Guinea on the west (Fig. 1).
Within the country itself the land is differentiated by agro-
ecological zones of natural vegetation. The deep southern region
is densely forested, particularly in the southwest. The mideastern
and midwestern regions are covered with tropical forest. The central
and northern regions of the country exhibits decreasing levels of
vegetation as one moves to the north (Fig. 2). The average annual
rainfall is 127 centimeters (about 50 inches). The relative
humidity averages about 80 percent in the south and ranges from 20
to 60 percent in the north.




B. ADAMA is an Ivorian CIRES-Ford Foundation Fellow in food
and resource economics at the University of Florida. C. G. DAVIS
and C. 0. ANDREW are associate professor and professor, respectively,
of food and resource economics at the University of Florida.








2








Alq,., s TuwsifI


r r ..










** NN A I
~ALGERIA,' LIA










'.iy' S I JlCb TA
..................
WObTRITANA C
NIGERA

F IL
......... 6 q~mcu SLJOAM


I ORY j HGE\pu i Ma is MC11-



L4




7-AMBIA COMORO

............
~YA-bR~4 i K3P~~~ :KFI~AMoqa~AS


4UI6A rl~~e~C~IGO LARE ~A "\ \11r-Ab


Figure 1. Location of the Ivory Coast.


%n.

THF

ABUNu
GU~zA-
IDAS5AU
b~q%4









+ 4 --+ 4-I -4- + 4 -4- 4-
44 + + t t + + +
"4 ++++++++- + -+++ +4 +--~-4-,
S+4 --+++ + ++++ + + + + + + + ++ -
S+ + + + 4 + + + ++-4-+ +- ++\+ +-4+++




\I )
4I +4-4-++ +34 + + + + t + + + ++




-L / -- -
S4 4 -4- 4. 4- -- + 4- 4-
.+.- +-+ 4- 4-+4 +'






: :'. : /
I D */


/ : *
:: : ,. : ,










SSUDANIAN ZONE

E SAVANNA

FORESTED ZONE



Figure 2. Agro-ecological zones and major rivers of the.Ivory Coast.










Four major rivers cross the Ivory Coast: The Comoe, the twin
Bandamas (on which the Kossou dam is erected), the Sassandra and
the Cavally. The latter delineates, to some extent, the frontier
between the Ivory Coast and Liberia. The river Bia, although not
a major river, is very important economically, since two hydro-
electric dams (Ayam6 I and Ayam6 II) have been built on it (Fig. 2).
According to the 1975 national census, the population of the
Ivory Coast was 6 million [37]. In 1970 the United Nations
estimated its natural population growth rate to be 3 percent per
annum [47]. The overall population density was 18.42 per square
kilometer (47.70 per square mile) in 1975. Over seventy ethnic
groups live in the Ivory Coast.-/
A large proportion of the more than 50,000 non-African resi-
dents in the Ivory Coast are French nationals, among which are
businessmen, advisors to government and industries, medical
doctors, and instructors in high schools, colleges and the National
University.
The more than five-years old government policy of Ivorianiza-
tion is aimed at the gradual replacement of all top and middle
level management positions held by aliens. However, the efficiency
and ethnical aspects of this policy has recently been questioned.
Therefore, in July 1977 an office was created to monitor the
implementation of the policy of the Ivorianization program in all
sectors of the economy.
Aggressive national programs of trade and business investment
diversification have been accompanied by an increase in the number
of other non-African alien (other than French) residents.


Agriculture and the National Economy


Like most African nations, the performance of the Ivory Coast
economy has, historically, been closely associated with the per-
formance of the primary sector (Table 1). However, unlike many


1/An ethnic group is defined here in terms of differentiation,
however small, between various languages, modes of subsistence,
social and political structure, etc.









other African countries (Zaire, Zambia), the mining subsector has
play a relatively minor role in the overall economic performance
of the country. The largest contribution to growth has come from
agriculture and forestry. The growth of the agricultural sector
and its relative contribution to both Gross Domestic Product (GDP)
and national income, can be largely attributed to coffee, cocoa,
and timber as primary export commodities. In 1952 these three
commodities represented 90 percent of agricultural export earnings
for the Ivory Coast, and by 1972 they were still accounting for two
thirds of the total (Table 2). There is, however, a growing concern
regarding the long term performance of the primary sector and its
constituent subsectors. This concern stems from certain observed
trends in post-1972 period. In 1975 the primary sector accounted
for 30 percent of the country's GDP. This contribution translated
into a 3 percent increase over the 1972 level (Table 1). However,
this relative share is projected to return to the 1972 level by
1980 and to decline to 25 percent by 1985 [38].
The dominant role of coffee and cocoa in the growth of the
agricultural sector can be largely attributed to the policy orien-
tation of the former French colonial administration towards its
African possessions. During this period no significant action was
taken to develop the food crop production system or that of export
crops, other than coffee and cocoa. In the neighboring Ghana, the
British colonial administration was actively promoting and imple-
menting the concept of indigenously owned plantations at a period
of time that the French were rejecting such a policy as being
irrelevant for the Ivory Coast. For the French colonial admin-
istration, the development of the plantation economy was predicated
on the entrepreneurial ability of Europeans, under a system of
compulsory indigenous labor, designed to provide a cheap source of
labor. This labor system involved a process in which African
teenagers and certain adults were drafted for work on the European
owned plantations. The system was rigidly enforced by the colonial
administration who also used this unskilled labor supply to build
roads, railways and other public works facilities. As remuneration,
those workers were given food and common shelters.














Table 1.--Trends and allocation of Gross Domestic Product of the Ivory Coast, by sector, 1960-1972



Fin. inter, Gross domestic
Primary Secondary Tertiary govt. agency & product (GDP)
Year sector sector sector householdsa


---------------- -------------------Billion CFA Francs-------------------------------


1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972


61.0
62.3
60.2
74.4
87.2
84.4
88.1
86.8
100.7
108.1
112.6
119.6
127.1


(43.O)b/
(39.0)
(36.0)
(38.0)
(36.0)
(35.0)
(34.0)
.(32.0)
(31.0)
(30.0)
(27.0)
(27.0)
(27.0)


19.9
24.7
27.4
30.2
36.0
40.6
49.1
53.2
62.3
68.8
89.0
104.9
116.5


(14.0)
(15.0)
(16.0)
(15.0)
(15.0)
(17.0)
(19.0)
(19.0)
(19.0)
(19.0)
(22.0)
(24.0)
(24.0)


49.6
60.1
63.4
74.4
93.6
89.0
95.5
107.3
133.1
153.8
172.0
176.1
189.5


(35.0)
(37.0).
(38.0)
(38.0)
(39.0)
(37.0)
(37.0)
(39.0)
(41.0)
(42.0)
(41.0)
(39.0)
(39.0)


12.1
14.2
17.3
18.8
22.9
25.6
25.3
28.4
30.4
34.8
41.7
45.3
47.4


(8.0)
( 9.0)
(10.0)
( 9.0)
(10.0)
(11.0)
(10.0)
(10.0)
( 9.0)
( 9.0)
(10.0)
(10.0)
(10.0)


142.6
161.3
168.3
197.8
239.7
239.6
258.0
275.7
326.5
365.5
415.3
445.9
480.5


- Value added by the financial intermediates,
payments is not considered part of production


government agencies and households
by the national accounting system.


based on salary


- Numbers in parentheses are percent of total GDP.


Source: [331.













Table 2.--Share of export commodities as percentage of total agricultural export earnings, Ivory
Coast, selected years, 1952-1972



Commodities 1952 1954 1956 1958 1960 1962 1964 1966 1968 1970 1972


--------------------------------------------Percent--------------------------------

Coffee 56.4 60.4 57.5 59.6 45.0 37.4 42.0 36.1 35.0 35.0 28.6
Cocoa 32.8 32.3 32.0 20.4 19.7 20.5 17.7 14.7 18.0 .18.0 15.6
Timber 3.3 3.7 4.8 10.5 13.6 16.3 20.0 19.0 19.4 17.0 21.2
Sub Total 92.5 96.4 94.3 90.5 78.3 74.2 79.7 69.8 72.4 70.0 65.4
Banada 1.7 1.2 1.3 4.0 5.1 5.8 5.1 6.0 4.0 4.0 4.2
Palm oils &
kernel 0.9 0.8 1.2 1.2 -- -- -- --
Colanuts -- -- -- -- 4.0 3.0 1.9 2.1 2.2 1.7 0.6
Pineapple -- -- -- 0.2 0.2 0.2 0.4 0.5 1.0 1.5
Miscellaneous 4.9 1.6 3.2 4.3 12.4 16.8 13.1 21.7 20.9 23.3 28.3
TOTAL 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0


Source: [34, 39].







8
Beginning in 1945, there was an awakening of political con-
sciousness among the Ivorian educated classes. This consciousness
was demonstrated by increased questioning of the colonial system
and ultimately its demise. A union of African cash crop farmers
2/
was organized under the leadership of Felix Houphouet Boigny.-
This alliance soon culminated in the formal organization of a large
scale political party, "Le Rassemblement Democratique Africain"
(RDA) at the French West African level, with Houphouet Boigny as
chairman. The strongest demand of the political party, particularly
in the Ivory Coast, was the abolition of the compulsory labor system
for Africans. However, the abolition of such a system was not easy,
since the effort led to violent and bloody confrontations in some
areas.
With the ultimate breakdown of the compulsory labor system,
came the liberation of a large number of workers that had been
trained coercively in the coffee and cocoa production systems.
Some of these workers stayed on their former plantations as a new
class of agricultural wage earners. Other workers sought employ-
ment in indigenous plantations and some created their own
plantations. These changes later generated a number of interesting
structural shifts in the economy. On one hand, there was an
accelerated rate of growth in the value contribution of coffee and
cocoa to total agricultural earnings to producers (Table 3). On
the other hand, relative shares of the two crops in total
agricultural export earnings declined significantly (Table 2).
In 1960, the development plan [34] of the Ministry of Planning
of the new independent Ivory Coast spelled out the dangers of having
the nation's economy based on the three primary commodities, coffee,
cocoa, and timber. It suggested that such a dependence would make
the economy an easy target for price fluctuations in international
markets. Therefore, the need to diversify cash crops became more
than a requirement for the immediate future. The goal of the new




2/
-/President of the Ivory Coast. He has held this office since the
country was granted its independence in 1960.














Table 3.--Value at price to producer of main domestic and export cash crops, Ivory Coast, 1960-1972



Commodities 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972


----------------------------------Million CFA Francs--------------------------------------


Coffee 13
Cocoa 7
Banana 1
Palm oil &
kernel
Colanuts
Pineapple &
pineapple
products
Cotton
Rubber
Tobacco
Copra
Essential oils


,508
,797
,743


15,541
5,613
1,790


9,113
6,043
2,052


941 820 949
686 740 740


268 269
192 176
-- 10
165 140
66 85
11 14


308
278
18
205
71
34


16,666
7,083
3,022


22,167
8,184
3,168


964 1,067
740 740


384
370
62
235
83
26


466
303
200
226
103
18


18,757
7,086
2,923


1,031
740



523
428
372
216
99
54


19,406
10,664
3,293

1,079
800



717
506
517
230
127
45


13,694
9,039
3,813


1,200
800



959
994
514
161
168
97


24,083 20,820
9,948 12,219
2,929 2,641


1,189 1,314
1,200 1,200



1,177 1,165
1,172 1,473
528 671
161 161
233 261
104 139


26,408
15,268
3,716


1,792
1,200



1,566
1,155
802
201
335
230


25,259 29,320
18,434 16,114
4,103 4,514


2,025
1,200



1,869
1,188
923
212
442
345


2,571
816



2,876
1,926
873
191
381
350


Source: [33].









agricultural policy was to allocate the relative weights of export
earnings to a greater number of commodities. In short, structural
diversification of the agricultural export sector was given high
priority. The plans also called for creation of local agricultural
processing facilities. Among commodities programmed to play new
and significant roles were palm oil and kernels, bananas, pineapple,
cotton, tobacco and rubber (Table 3). It would appear that the
policy had some positive effect. Table 3 indicates that there has
been a significant increase in the value contribution of these com-
modities over the 1960-1972 period. Also, to the extent that some
of these commodities are included in the miscellaneous export
category of Table 2, there are indications that the increased
production of these commodities was a major factor associated with
the relative decline in the share of coffee and cocoa in agricultural
export earnings over the period.
The relative revenue share of commodities such as pineapple
and pineapple products, cotton and rubber, exhibited a general
positive trend from 1960 to 1972 (Table 4). The rather constant
share of palm oil and kernel prior to 1970, probably can be explained
by the fact that the first villagers' plantations, established
under the sponsorship of SODEPALM,/ and SODEPALM-owned industrial
plantations, only reached the full production stage in the 1970s.
As far as food crops were concerned, specific plans were
designed to encourage the production of cereals (rice, corn, sor-
ghum), but with major emphasis placed on rice. Unlike rice, the
production of root crops such as yam, cocoyam, sweet potatoes, and
the other starchy food commodities such as plantain, were not a
matter of concern. Irrigated rice production was introduced in
the north with cotton, sugar cane and tobacco, to serve as cash
crops and stimulate development of a more monetized economy in
that area. These agricultural policicies and programs in the north




-/SODEPALM is a state agency created by decree-law in November 1963
to carry out the program of development of African palm in the
Ivory Coast.



















Table 4.--Trend and allocation of the revenue to producer to main export crops, selected years,
1960-1972

Commodities 1960 -1962 1964 1966 1968 1970 1972

---------------------------------------Million CFA Francs-------------------------------------

Coffee 13,508 (53.2)-/ 9,113 (46.5) 22,167 (60.5) 19,406 (52.0) 24,083 (56;4) 26,408 (50.2) 29,320 (48.9)
Cocoa 7,797 (30.7) 6,043 (30.8) 8,184 (22.3) 10,664 (28.5) 9,948 (23.3) 15,268 (29.0) 16,1L4 (26.9)
Banana 1,743 ( 6.9) 2,052 (10.5) 3,168 ( 8.6) 3,293 ( 8.8) .2,929 ( 7.0) 3,716 ( 7.0) 4.514 ( 7.5)
Palm oil &
kernel 941 ( 3.7) 749 ( 3.8) 1,067 ( 2.9) 1,079 ( 2.9) .1,189 ( 2.8) 1,792 ( 3.4) 2,571 ( 4.3)
Coconuts 636 ( 2.7) 740 ( 3.8) 740 ( 2.0) 800 ( 2.1) 1,200 ( 2.8) 1,200 ( 2.3) 816 ( 1.4)
Pincaipple &
pineapple
products 268 (1.0) 308 (1.6) 466 (1.3) 717 (2.0) 1,177 ( 2.7) 1,566 (3.0) 2,876 ( 4.8)
Cotcon 192 ( .8) 278 (1.4) 303 ( 1.0) 506 ( 1.3) 1,172 ( 2.7) 1,155 (2.2) 1,926 ( 3.2)
Rubber ( ) 18 -- ) 200 ( .5) 517 (1.4) 528 ( 1.2) 802 ( 1.5) 873 (1.5)
Tobacco 165 ( .7) 205 ( 1.0) 226 ( .6) 230 ( .6) 161 ( .4) 201 ( .4) 191 ( .3)
Copra 66 ( .3) 71 ( .4) 103 ( .3) 127 ( .3) 233 ( .5) 335 ( .6) 381 ( .6)
Essential oils 1 ( -- ) 34 ( .2) 18 ( .05) 45 ( .1) 104 ( .2) 230 ( .4) 350 ( .6)

TOTAL 25,377(300.0) 19,611 (100.0) 36,642(100.0) 37,384(100.0) 52,673(100.0) 52,673 (100.0) 59,932 (100.0)


::u/hbers in parentheses are percent of total.

source: [33]









were expected to reduce the gap between the level of income per farm
worker in that region and that of plantation owners in the central
4/
and southern regions.- In addition, the long run target for rice
production over the 1960-1970 period was to improve human nutrition,
and above all, eliminate costly rice imports [35, p. 162].
An agricultural modernization agency (SATMACI) was created in
1958 to provide farmers with technical assistance and, above all,
to administer the development efforts relating to export crops. In
1966 the agency was given the additional task of developing and
implementing the domestic rice program. The agency developed a
scheme called "Operation-Rice," which was designed to deal with
problems concerning technical and manpower aspects of rice
production. At the end of 1967 the agency had 1,073 specialists
and technicians working on rice production alone.
At the same time, SATMACI was also to serve as a research
institute concerned with the development of high yielding rice
varieties, adaptable to a wide range of ecological conditions.
This function brought about the creation of a limited number of
regional experimental irrigated rice stations in the northern
region. These stations were instrumental in the development of
rice varieties capable of producing three crops per year in that
region, with a total annual yield of 10 tons per hectare. Similar
results were being achieved in Yamoussokro in the central part of
the country. In addition to its other functions, SATMACI was
given the responsibility for installing rice mills, silos and pro-
viding market outlets for the rice [41].
The 1967-70 planning budget provided 4,422 millions CFA francs./
for the development of rice cultivation [40]. Special attention
was given to irrigated rice in the north, with the financial and
technical assistance of the French and West German governments.




-In the north, the owner is also a farm worker, while in central and
southern regions the plantation owner relies on hired labor force.
He and his family contribute very little labor to the system.


- $1.00 U. S. = 250 CFA francs.








French technical assistance provided valuable input, when in 1962
it completed a drainage and terracing project in the Korhogo area.
At the same time, a loan from West Germany made possible the com-
pletion of a new irrigation scheme near Korhogo.
Hydro-agricultural projects accounted for 9,000 hectares of
irrigated rice, producing 37,000 tons of paddy rice in the northern
region in 1967. Regional plans called for an expansion to 24,000
hectares and 120,000 tons of paddy rice by 1970. This projected
expansion represented a 224 percent increase over the 1967 level
of production [41]. One of the primary goals established in the
1966 policy was to completely eliminate rice imports by the year
1970. At that time it was estimated that more than 460,000 tons
of paddy rice would have to be produced in 1970 if the 1967 level
of rice consumption were to be maintained. This target output
translated into approximately 60 kilograms of husked rice per
capital per year. To encourage farmers to contribute to the success
of "Operation-Rice," the government, in November 1966, guaranteed
growers cash payment for their crops at a minimum support price of
18 CFA francs per kilogram of paddy rice [41].
In a rice mill inaugural address in 1969, the Minister of
Agriculture indicated that in order to satisfy projected increases
in consumer demand in the year 1975 more than 500,000 tons of paddy
rice would have to be produced annually, up to that period. He
based his estimates on the increasing trend in per capital rice
consumption [3]. The government had budgeted the total sum for
state contribution to agricultural development over the 1969-1971
period at 30,000 millions CFA francs, including foreign aid. The
main targets [3, p. 1402] at this budgeted expenditure level were
to:
increase the area under palm oil plantation from 45,000
hectares to 83,000 hectares.
develop new rubber plantation areas in the southwest.
produce 80,000 tons of cotton fiber.
increase cocoa production to 200,000 tons, by renewal
and extension of existing plantations, particularly in
the southwest.







14

limit coffee production to 300,000 tons and develop a

program for the diffusion of new varieties.

produce 140,000 tons of pineapple of which 125,000

tons were to be canned.

export 175,000 tons of bananas.

develop a program for rice production which would make

rice import unnecessary by 1970-1975.

Rice import substitution was to be accomplished by a targeted figure

of 500,000 tons of paddy rice production annually over the period,

which would balance the estimated domestic demand at the end of the

period.

In 1970, a new state agency for the development of rice cul-

tivation (SODERIZ) was created in order to take over some of the

functions of the former SATMACI. SODERIZ was to deal with all

matters related to the production and distribution of rice. How-

ever, SODERIZ's main task was to improve rice cultivation methods

among small farmers and to facilitate a shift from upland to

irrigated rice.

At the end of 1973, three years after SODERIZ was created,

the Ivory Coast imported 147,000 tons of rice [20]. This was the

largest quantity of rice imports in the history of the country.

The 1973 imports were almost twice the level of imports in the

previous year (Table 5). Decisions were then made to increase the

price of paddy rice to producer by 3 CFA francs per kilogram. The

price increase was designed as an incentive to encourage rice

growing and thereby reach the production targets for 1975. SODERIZ

provided farmers with fertilizers, improved seeds for upland, flooded

and irrigated rice, and pesticide. Moreover, SODERIZ developed rainfed,






15
Table 5.--Production and import trends for rice, Ivory Coast,


1950-1962


Domestic Domestic Imports Imports
production production as pro-
(Hulled as pro- portion
quantity portion of Quantity Value of total Total
harvested) total avail- available quantity
able quantity available
Year quantity


Thousand
metric
tons

71.0
63.1
88.0
55.7
58.9
68.5
56.5
79.8
42.5
n.a.
96.0
93.6
138.0
132.0
148.8
150.0
165.0
208.2
219.0
181.8
189.6
231.0
192.0


Percent

99.0
90.0
91.0
96.0
47.0
80.0
82.0
75.0
75.0
n.a.
73.0
65.0
74.0
80.0
70.0
69.0
66.0
90.0
82.0
77.0
71.0
70.0
71.0


Thousand
metric
tons
a/
1.1
7.1
9.1
2.1
8.8
16.7
12.5
25.9
14.1
n.a.
35.5
50.5
47-. 8
33.7
62.7
68.8
83.2
24.1
47.2
55.6
78.8
97.3
77.1


Million
CFA
francs Percent


32.9-/
220.2
350.1
85.4
276.0
491.3
294.4
686.9
390.5
n.a.
867.0
1,201.0
1,577.0
1,045.0
2,060.0
2,486.0
3,113.0
875.0
1,873.0
1,876.0
2,033.0
2,204.0
2,417.0


2.0
10.0
9.0
4.0
7.0
20.0
18.0
25.0
25.0
n.a.
27.0
35.0
26.0
20.0
30.0
31.0
34.0
10.0
18.0
23.0
29.0
30.0
29.0


Thousand
metric
.tons

72.1
70.2
97.1
57.8
125.5
85.2
69.0
105.7
56.6
n.a.
131.5
144.1
185.8
165.7
211.5
218.8
248.2
232.3
266.2
237.4
268.4
328.3
269.1


Z Including imports for Upper Volta.


Source: [10, 33, 34, 39]


1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972







16

flooded and irrigated rice schemes not only in the northern region, but

in the central, western and south-western regions as well. Farmers were

assured that their output would be purchased by SODERIZ. Producers

were required to repay the agency in "kind" for the cost of the various

inputs provided.

SODERIZ's basic marketing policy involved collecting rice all over

the country at three different levels, (a) the producer level (b) the

SODERIZ paddy rice storage facilities, and (c) the SODERIZ milling faci-

lities. The price at each of these levels was set by the government.

Once the paddy rice was milled it was SODERIZ's responsibility to store

it until the appropriate time came to turn it over to the Ministry of

Commerce, which was responsible for channeling the final product to

wholesalers and retailers. However, only 450,000 tons of paddy rice

were produced in 1975 and imports were still necessary [36]. In 1977

the Ivory Coast experienced a severe rice shortage, to the extent that

rice had to be rationed among consumers in Abidjan, the capital city.

The situation was blamed on inefficiencies in the rice marketing system.

Following a reshuffle of government ministers in July 1977, the new

Minister of Agriculture announced that the SODERIZ program would be

discontinued.

According to the 1976-1980 Five Year Plan [36, p. 129], paddy

rice production is expected to reach 800,000 tons in 1980, and 1,030,000

tons in 1985. At the 1980 and 1985 projected levels of production there

will still be deficits of 265,000 and 495,000 tons of paddy rice,

respectively, based on per capital consumption of 34 kilograms of husked

rice in rural areas, and 74 kilograms in urban areas. The estimates

translated into 1980 estimated average per capital consumption of 51

kilograms of husked rice. For 1985, that average was expected to reach








Table 6.--Domestic rice production, hectareage under
yields, Ivory Coast, 1950-1972


cultivation and


Production Average
yield per
Quantity Quantity hectare
Year (Paddy) (Hulled) Hectareage


------Thousand metric----
tons


Thousand
hectares


Metric tons


71.0
63.1
88.0
55.7
58.9
68.5
56.5
79.8
42.5
n.a..
96.0
93.6
138.0
132.0
148.8
150.0
165.0
208.2
219.0
181.8
189.6
231.0
192.0


Source: [10, 33, 34, 39].


1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972


118.3
105.2
146.6
92.8
98.1
114.1
94.1
133.0
70.8
n.a.
160.0
156.0
230.0
220.0
248.0
250.0
275.0
347.0
365.0
303.0
316.0
385.0
320.0


220.2
211.2
209.2
146.4
163.2
188.0
205.2
223.7
206.1
n.a.
218.0
206.0
260.0
245.0
271.0
261.0
258.0
302.0
300.0
288.0
289.0
282.0
282.0


.538
.498
.701
.636
.601
.607
.458
.594
.343
n.a.
..734
.757
.885
.898
.915
.958
1.066
1.149
1.217
1.052
1.093
1.365
1.135




















Hulled rice
in 1000 tons
400-


350-


300-


250-


200-


150-


100


50


Total
Available



Domestic
Production




Import


1960 1961 .1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972


Figure 3., Trends in rice production, imports and total quantity available, Ivory Coast, 1960-1972.






19

55 kilograms, with the urban per capital rice consumption still

holding the lead [36].

According to the West African Rice Development Association (ADRAO)

[2], the estimates for average annual growth rates of rice consumption

for the Ivory Coast will decrease from 5.6 percent for the 1975-1980

period, to 4.9 percent over the 1980-1990 period. This projected

decline is imputed to projected decline in the urban annual growth rate

of rice consumption. Indeed, the urban average annual growth rate of

rice consumption, according to the ADRAO study, is expected to move

from 8.9 percent over the 1975-1980 period to 6.5 percent over the

1980-1990 period. On the other hand, the rural average is expected

to move from 2.7 to 3.0 percent over comparable periods. These

projections were based on estimated income elasticities for rice of

.20 for urban areas and .40 for rural areas. Results from the ADRAO

study on demand, supply and trade position of the Ivory Coast for rice,

were not significantly different from those of the Ministry of Planning

[36]. Both studies agreed that the Ivory Coast would still be a net

importer of rice in the years 1980 and 1990. Rice selfsufficiency

ratios- computed for the Ivory Coast by ADRAO [2], for the 1965-1976

period, indicated a generally positive trend. However, the trend was

subjected to fluctuations. For example, over the 1965-1972 period

the selfsufficiency ratio reached a peak of 86 percent in 1967 and

low of 62 percent in 1966. The value of the ratio was 74 percent

in 1972.


6/
The selfsufficiency ratio is defined by ADRAO as production minus
seed and losses, divided by the net availability, which is defined
as production minus seed and losses, minus changes in stocks, plus
net imports.





20

Table 7.--Area under selected.non-food cash crops, Ivory Coast,
1960-1972



Palm oil & Rubber
coconut trees
Year Coffee Cocoa Cotton trees Tobacco


-------------------Thousand hectares---------------------


1960

1961

1962

1963

1964

1965

1966

1967

1968

1969

1970

1971

1972


n.a.

506.0

520.2

513.0

559.5

558.0

473.2

649.0

665.0

652.0

652.0

674.0

695.0


n.a.

268.0

787.7

321.0

361.0

366.0

340.0

332.0

347.0

353.0

369.0

404.0

423.0


n.a.

53.0

61.0

78.5

47.4

38.5

51.0

59.2

68.0

53.2

56.0

71.4

76.0


n.a.

6.4a/

14.1

17.3

22.0

29.2

39.0

46.5

59.2

69.0

79.1

81.9

105.6


n.a.

6.0

7.0

8.0

8.0

8.0

7.5

8.0

7.0

7.0

7.0

7.4

7.0


n.a.

9.0

10.0

11.0

11.0

11.0

11.6

12.0

12.6

12.6

12.9

13.1

13.1


a/Area under coconut trees excluded.


Source: [391.






21

Problem Statement


Despite the heavy emphasis placed on domestic rice production

in the Ivory Coast's economic development plans since 1960, the

country has failed in its attempt to eliminate rice imports or to

maintain these imports at the minimum level recorded in 1967

(Table 5). Although the country produced an average of 339,000

tons of paddy rice for the last 6 years (1967-1972) of the period

covered in the study, it nevertheless relied heavily on imports,

particularly towards the end of that period (Table 5).

Governmental failure to meet rice import substitution goals

prompted a series of programs designed to improve the overall

performance of the domestic rice economy. The programs ranged

from raising the guaranteed price level paid to rice producers to
7/
creation of a facilitating state agency, SODERIZ.- Domestic rice

production and hectareage data show that, although the general trend

was positive from 1960 to 1972, it was vulnerable to varying degrees

of fluctuation (Table 6 and Fig. 3). The data indicate that rice

imports, after following a trend inverse to that of domestic production

from 1960 to 1962, moved in the same direction as domestic production

up to 1967. In 1967 rice imports fell to the lowest level during the

1960-1972 period. Following 1967, both domestic production and imports

registered a vigorous upward trend, with both trends peaking in 1971

(Fig. 3).



7/
As indicated earlier, SODERIZ was subsequently dismantled in
July 1977.









The 1972 levels were characterized by a simultaneous decline,
with nearly 17 percent and 21 percent decreases for domestic rice
production and rice imports, respectively, relative to their levels
of the previous years. The observed trends in the post-1971 period
could suggest, among other things, (a) movement by consumers away
from rice to rice substitute commodities, (b) rice producers were
moving from rice cultivation to other crops, and (c) a combination
of (a) and (b). Production data indicate that hectareage under
rice cultivation has been registering a negative trend since its
maximum of 302,000 hectares in 1967. The data also indicate that
average yield per hectare has remained fairly constant over the
period (Table 6). This trend could be indicative of a number of
dynamic structural changes. For one thing, it could suggest that,
under a vigorous policy of agriculture diversification, other crops
are competing effectively with rice for scarce arable land. Since
average yield remained fairly constant over the period, there is
little evidence to suggest that declining hectareage was a con-
comitant part of increased productivity. The evidence, therefore,
strongly support suggestion (b) above, that rice producers probably
were shifting to other crops.
With a few notable exceptions, such as tobacco and rubber,
the area under non-food cash crops, for which data were available,
registered a steady rate of increase over the 1960-1972 period
(Table 7). From 1964, when SODEPALM established its first palm
plantations, to 1972, the hectareage under palm and coconut in-
creased 380 percent. From 1967, when the area allocated to rice
production reached its peak (Table 6), to 1972, the hectareage
under coffee, cocoa, cotton, palm and coconut increased by 7.1,
27.4, 28.4 and 127.1 percent, respectively (Table 7).
According to the United Nations Economic Commission for Africa
(E.C.A.) [47], the estimated population of the Ivory Coast was
5,090,000 inhabitants in 1970. The report also estimated a popu-
lation of 50 persons per square kilometer of arable land for the
country as a whole. From these estimates one could extrapolate
that the available arable land in the Ivory Coast might amount to
about 87,759 square kilometers. This would represent approximately









27 percent of the surface area of the country. Furthermore, with an
annual population growth rate of 3 percent [47], the problem of
allocating arable land among competing agricultural enterprises
could arise in the not too distant future.
Williams argued, in a 1967 report [48], that there were no
non-rectifiable reasons why the Ivory Coast should be a persistent
net importer of rice. In spite of this observation, over a decade
ago, the failure of domestic rice production to keep pace with
domestic demand still remains a reality up to the present time.
This persistent disequilibrium between domestic demand and domestic
supply has resulted in a drain of scarce foreign exchange earnings
through high rice import bills. For example, Table 5 shows that in
1971 the Ivory Coast spent 2,204 millions CFA francs for 97,300 tons
of rice. In 1972 it spent 2,417 millions CFA francs for only 77,100
tons, which meant a 10 percent increase in the import bill, with a
21 percent decrease in the quantity imported. Such an inflationary
impact on the imported food commodity bill exerts a strong pressure
on foreign exchange earnings available for development purposes.
Such earnings are vital for effective implementations of development
efforts. Concern over such inflationary pressures is a legitimate
concern in light of the development objectives of the country. It
could be dangerous to ignore the trends on the basis of the fact
that the Ivory Coast is currently experiencing a positive balance
of trade (Table 8).
Dealing with that matter Johnston and Mellor [26, p. 573] write:
Owing to the severe economic and political repercussions of
a substantial rise in food prices, domestic shortages are
likely to be offset by expanded food imports, provided
that foreign exchange or credits are available. For some
countries that are in favorable positions with respect to
foreign exchange earnings this may be a satisfactory
solution. But foreign exchange is usually in short
supply and urgently required for imports of machinery and
other requisites for industrial development that cannot
be produced domestically.

Chenery described the desire for food import substitution as
"the most important and most difficult aspect of development
programming." He further argued [12, p. 67], that:







Table 8.--Evolution of the Ivory Coast balance of trade, 1951-1972



Exports Imports Balance
of
Year Quantity Value Quantity Value trade


Thousand Million Thousand Million Million
metric CFA metric CFA CFA
tons francs tons francs francs

1951 283.467 17,481 332.800 15,372 + 2,109
1952 239.552 18,833 351.700 15,573 + 3,260
1953 294.717 19,085 322.200 12,453 + 6,632
1954 310.592 27,311 426.400 19,338 + 7,973
1955 388.917 25,685 448.900 19,005 + 6,680
1956 476.380 26,340 458.500 18,417 + 7,923
1957 506.165 24,426 478.800 19,512 + 4,914
1958 650.344 31,492 476.200 22,827 + 8,665
1959 n.a. n.a. n.a. n.a. n.a.
1960 1032.005 44,418 617.210 34,123 +10,295
1961 1345.351 51,331 725.995 47,361 + 3,970
1962 1463.593 51,718 715.914 44,427 + 7,291
1963 1753.576 61,598 725.857 47,856 +13,742
1964 2213.048 79,666 1047.370 62,908 +16,758
1965 2312.228 70,932 1206.131 63,732 + 7,200
1966 2343.099 78,259 1499.775 67,803 +10,456
1967 2743.064 82,479 1467.057 72,209 +10,270
1968 3273.842 110,316 1906.782 83,585 +26,731
1969 3640.888 124,080 1850.370 94,917 +29,163
1970 3001.048 137,941 2085.077 115,986 +21,955
1971 3102.570 137,361 1906.906 122,777 +14,584
1972 n.a. 153,162 n.a. 128,686 +24,476


Source: [33, 34].









In view of the potential that exists for increasing
agricultural productivity, it is likely to be advan-
tageous to obtain the additional food supplies by
increased domestic output rather than relying on
expansion of exports to finance enlarged food imports.

Chenery's recommendations appear to have been taken into
consideration by the Ivory Coast. However, given the poor perfor-
mance of the rice economy in meeting national self-sufficient goals,
close analysis of the sector deserves high priority.


Objectives of the Study


This study is an attempt to evaluate the poor performance of
the domestic rice production system in the Ivory Coast for meeting
domestic demand.


General Objective


The general objective of the study is to suggest alternative
developmental strategies, based on empirical findings, that would
stimulate domestic rice production to levels consistent with a
national self-sufficiency target in rice production.


Primary Objectives


Objective 1: Estimate (a) the impact of producer prices of
rice and other major cash crops on domestic rice production and (b)
the relative allocation of land resources to rice vis-a-vis these
cash crops, and the impact of the use of fertilizer on the level of
domestic rice production.
Objective 2: Determine and quantify those key factors associ-
ated with increases in the aggregate annual domestic demand for rice.
Objective 3: Assess differences between aggregate domestic
rice supply and aggregate demand growth rates, as a basis for de-
termining if persistent disequilibrium between the two might be
associated with a differential in resource allocation between export
crops and rice crop.







Objective 4: Determine whether the 1972 declines in domestic rice
production and rice import are associated with generalized changes in the
commodity substitution bundle at the consumers' level, i.e., whether
other commodities were being substituted for rice.


Data Base


The data used in the present study were obtained primarily from
documents issued by the Ministries of Planning and Agriculture of
the Ivory Coast. In addition, extensive use is made of published
and unpublished data from a wide variety of national and international
organizations and agencies. Although the study covers the 1950-1972
period, the statistical models use 1960-1972 as the data base period.
This base period was necessitated by the paucity of relevant data on
the country's rice economy in the pre-1960 period. It is felt that
the 1960-1972 period captures more of the dynamic elements of the
country's social, political and economic characteristics, since it
covers the post-independent period. The post-1972 period was excluded
because of data unavailability.


RICE CONSUMPTION AND SUPPLY CHARACTERISTICS: A REVIEW


Structural Setting

There is growing evidence that the demand and supply charac-
teristics of the Ivory Coast rice economy are directly related to
(a) the economic characteristics of rice producing areas, partic-
ularly as related to rice-competing cash crops and (b) consumption
patterns of rapidly expanding urban areas, particularly as such
consumption shifts are related to labor movements from traditionally
food crop dominated areas to urban and export cash crops plantation
areas. To what extent are these structural characteristics associ-
ated with supply and demand relationships? A brief review of these
components is presented below in an attempt to provide a contextual
framework for subsequent discussion of consumption and production
characteristics.







Objective 4: Determine whether the 1972 declines in domestic rice
production and rice import are associated with generalized changes in the
commodity substitution bundle at the consumers' level, i.e., whether
other commodities were being substituted for rice.


Data Base


The data used in the present study were obtained primarily from
documents issued by the Ministries of Planning and Agriculture of
the Ivory Coast. In addition, extensive use is made of published
and unpublished data from a wide variety of national and international
organizations and agencies. Although the study covers the 1950-1972
period, the statistical models use 1960-1972 as the data base period.
This base period was necessitated by the paucity of relevant data on
the country's rice economy in the pre-1960 period. It is felt that
the 1960-1972 period captures more of the dynamic elements of the
country's social, political and economic characteristics, since it
covers the post-independent period. The post-1972 period was excluded
because of data unavailability.


RICE CONSUMPTION AND SUPPLY CHARACTERISTICS: A REVIEW


Structural Setting

There is growing evidence that the demand and supply charac-
teristics of the Ivory Coast rice economy are directly related to
(a) the economic characteristics of rice producing areas, partic-
ularly as related to rice-competing cash crops and (b) consumption
patterns of rapidly expanding urban areas, particularly as such
consumption shifts are related to labor movements from traditionally
food crop dominated areas to urban and export cash crops plantation
areas. To what extent are these structural characteristics associ-
ated with supply and demand relationships? A brief review of these
components is presented below in an attempt to provide a contextual
framework for subsequent discussion of consumption and production
characteristics.







Objective 4: Determine whether the 1972 declines in domestic rice
production and rice import are associated with generalized changes in the
commodity substitution bundle at the consumers' level, i.e., whether
other commodities were being substituted for rice.


Data Base


The data used in the present study were obtained primarily from
documents issued by the Ministries of Planning and Agriculture of
the Ivory Coast. In addition, extensive use is made of published
and unpublished data from a wide variety of national and international
organizations and agencies. Although the study covers the 1950-1972
period, the statistical models use 1960-1972 as the data base period.
This base period was necessitated by the paucity of relevant data on
the country's rice economy in the pre-1960 period. It is felt that
the 1960-1972 period captures more of the dynamic elements of the
country's social, political and economic characteristics, since it
covers the post-independent period. The post-1972 period was excluded
because of data unavailability.


RICE CONSUMPTION AND SUPPLY CHARACTERISTICS: A REVIEW


Structural Setting

There is growing evidence that the demand and supply charac-
teristics of the Ivory Coast rice economy are directly related to
(a) the economic characteristics of rice producing areas, partic-
ularly as related to rice-competing cash crops and (b) consumption
patterns of rapidly expanding urban areas, particularly as such
consumption shifts are related to labor movements from traditionally
food crop dominated areas to urban and export cash crops plantation
areas. To what extent are these structural characteristics associ-
ated with supply and demand relationships? A brief review of these
components is presented below in an attempt to provide a contextual
framework for subsequent discussion of consumption and production
characteristics.









Structural Changes in Food Producing Areas


The northern region, where the bulk of the country's food crops
are grown, is characterized by labor force migration and a lower in-
come level relative to the southern plantation areas. Such a mobility
of labor force from areas with labor intensive activities to zones
with a relatively high capital to labor ratio could, in the long
run, have adverse economic effects on farming activities in the north.
In general, farmers in the northern region have had limited success
in growing export cash crops, such as coffee, cocoa, pineapple,
banana and palm. On the other hand, successful cultivation of these
crops on southern plantations has resulted in a significant regional
income differential between the north and south.


Structural Changes in Urban and Plantation Labor Force


As far as the urban area is concerned, one of the basic prob-
lems is the growing population. In 1960, the urban population was
estimated to be 450,000 inhabitants, with an estimated annual growth
rate of 7.5 percent. Based on those estimates, the total urban
population was projected to be 1,071,800 inhabitants in 1972. If
the compounded growth rate of 10.57 percent for the capital city
Abidjan remained constant, its 1965 estimated population (265,000
inhabitants) would have amounted to 516,400 in 1972.8/
The results of the 1975 census show that, out of a total popu-
lation of 6,720,000 inhabitants, the urban population was 2,151,000,
which represented 32 percent of the total population. Abidjan, the
capital city and its surrounding communities was inhabited by 937,000
people. This number amounted to 44 percent of the total urban
population, and 14 percent of the overall population of the Ivory
Coast. Furthermore, according to estimates made by the Ministry of
Planning (Table 9), the urban population as a whole is expected to


Computations based on data in [4, pp. 35-511.









Structural Changes in Food Producing Areas


The northern region, where the bulk of the country's food crops
are grown, is characterized by labor force migration and a lower in-
come level relative to the southern plantation areas. Such a mobility
of labor force from areas with labor intensive activities to zones
with a relatively high capital to labor ratio could, in the long
run, have adverse economic effects on farming activities in the north.
In general, farmers in the northern region have had limited success
in growing export cash crops, such as coffee, cocoa, pineapple,
banana and palm. On the other hand, successful cultivation of these
crops on southern plantations has resulted in a significant regional
income differential between the north and south.


Structural Changes in Urban and Plantation Labor Force


As far as the urban area is concerned, one of the basic prob-
lems is the growing population. In 1960, the urban population was
estimated to be 450,000 inhabitants, with an estimated annual growth
rate of 7.5 percent. Based on those estimates, the total urban
population was projected to be 1,071,800 inhabitants in 1972. If
the compounded growth rate of 10.57 percent for the capital city
Abidjan remained constant, its 1965 estimated population (265,000
inhabitants) would have amounted to 516,400 in 1972.8/
The results of the 1975 census show that, out of a total popu-
lation of 6,720,000 inhabitants, the urban population was 2,151,000,
which represented 32 percent of the total population. Abidjan, the
capital city and its surrounding communities was inhabited by 937,000
people. This number amounted to 44 percent of the total urban
population, and 14 percent of the overall population of the Ivory
Coast. Furthermore, according to estimates made by the Ministry of
Planning (Table 9), the urban population as a whole is expected to


Computations based on data in [4, pp. 35-511.
















Table 9.--Estimates of urban, rural and total population, Ivory Coast, selected years, 1972-1990



Areas 1972 1975 1980 1985 1990


.----------------------------------Thousands-----------------


Abidjan 516.4/ 937 1,330 1,780 2,315

Total Urban 1,071.3 2,151 2,965 3,980 5,215

Rural 4,351.2 4,569 4,960 5,315 5,715

Total population 5,423 6,720 7,925 9,295 10,930


a/Estimate based on the 10.57 percent compounded growth rate.


Source: [36].









increase rapidly, reaching a total of 2,965,000, 3,980,000 and
5,215,000 inhabitants in 1980, 1985 and 1990, respectively. The
urban population in these years would represent 37, 43 and 48
percent of the total population of the Ivory Coast, while the popu-
lation in Abidjan and its adjacent areas would amount to 44 percent
of the total urban people and 21 percent of the overall population
in 1990.
Regarding export crop plantation areas, the immigration of labor
from countries such as Upper Volta, Mali, Guinea and the northern
regions of the country has contributed to a significant growth in
the adult population in these areas. For example, in 1950 the non-
indigenous African population in the rural areas represented 2.5
percent of the total rural population. By 1965 that proportion had
risen to 22 percent. The north which accounted for 34 percent of
the rural population in 1950, accounted for only 27 percent in 1965.
In 1975 this percentage had declined to 26 [37]. Two common
characteristics of urban and plantation areas are their heterogeneous
population and relatively higher levels of income.


Consumption and Supply Characteristics:
Literature Review


The post World War II agricultural commodity literature has
focused globally on export crops as well as on food crops. On one
hand, the literature on export crops tends to concentrate on trade
and fluctuation problems in the export earnings of less developed
countries (LDCs) while, on the other hand, discussions on agricultural
food commodities have tended to focus on food and nutrition problems
of LDCs [21]. A relatively large proportion of this literature is
concerned with LDC's adaptation of green revolution technology for
basic grains, and the associated second and third generation problems
[13].
From a nutritional standpoint, the production of basic grains
and vegetable should warrant special attention in the developing
nations, relative to starchy roots. The former commodities provide
higher levels of the nutrients essential for balanced diets, impor-
tant for human growth and development. If calorie intake is a good







30

quantitative indicator of diet adequacy, protein levels provided
by cereals and other vegetables is the quality indicator (Table 10).
Adequate protein intake is essential to physical growth and
maintenance. Diseases such as kwashiorkor, endemic goiter, anemia,
beri beri and obesity have been found to be associated with nutrient
deficiency. According to the Nutrition Reviews [42] these nutrition
related diseases are prevalent among infants and children in many
areas of the developing world. The prevalence of such diseases
among the younger populations tends to affect their health status
in later years. The article further indicates that mental apathy
and dullness among children have been found to be associated with
kwashiorkor, and that differences in alertness were evident between
two African tribes with different diets.
A study conducted by the FAO [15] indicates that decreased
physical efficiency and mental effectiveness, resulting from nutri-
tional deficiencies, may in turn lower the level of aspiration of
the people affected. These conditions in turn tend to perpetuate
the conditions that cause them in the first place.
Empirical evidence strongly supports the contention that the
lack of food and poor nutrition in LDC's will not only impair the
population's productivity, but it will also affect their psycho-
logical attitudes and social behavior in such a way to impede their
overall economic development. A problem of general concern to
economists is the inability of the agricultural commodity sector in
the developing countries to produce the necessary quantity of basic
grains such as wheat, rice, corn, to meet the food demand of their
growing population. A typical example of this situation is the
African experience (Fig. 4). In this case the figure dramatically
illustrates a continuing and widening gap between the rate of growth
in domestic food production and the rate of growth in population.
Empirical studies indicate that the income elasticity of demand for
food in developing countries is considerably higher than in the
developed nations [26]. A 1967 FAO study [16] indicates that the
income elasticities were .7 and .6 for wheat and rice, respectively,
in the Ivory Coast. These relatively high elasticities are related
to the fact that, in West Africa, grain products, particularly rice
and wheat, are major wage goods. This characteristic means that






31
Table 10.--Nutrient composition per 100 grams of selected agricultural
commodities, calories, protein, and fat




Commodity Calories Protein Fat


Number --------Grams----------


wheat medium Extr 94-100 334 12.2 2.3

wheat medium Extr 80-93 350 11.7 1.5

wheat medium Extr under 80 364 10.9 1.1

Rice milled white, Extr under 70 360 6.7 0.7

Maize Extr 97-100 356 9.5 4.3

Maize Extr 90-96 360 9.3 4.0

Maize Extr under 90 363 8.4 1.2

Millet ragi Extr all rate 332 6.5 1.7

Sorghum Extr all rate 343 10.1 3.3

Sweet potatoes 97 1.1 0.3

Cassava fresh 109 0.9 0.2

Yam 90 2.1 0.2


Source: [1&].













160


150



140


130 -


120



110


100 0_ __--


90
-1i------- ---- ----i---------|- ---


1960 1961 1962 1963 1964 1965 1966 1967 1968 1969

Food Production -O-0-- Population ---- Per Caput Food
Production
(2.2)* is the food production annual rate of growth in the decade 1956-58,
1966-68.

Source. The State of Food and Agriculture 1970, FAO/UN 1970.

Figure 4. Trend in food production and population in Africa (South Africa excluded), 1960-1969.









wheat and rice are generally preferred over other grains, such as
sorghum, barley and corn. Thus, rice and wheat consumption tend
to rise steadily as incomes rise, since 60 to 70 percent of consumer
personal disposable income is spent on these commodities,


Most of the western African countries, including the Ivory
Coast (Table 11), have failed to meet their domestic demand for a
basic grain such as rice, without resorting to massive imports.
Over the period 1960-1972 the expenditure on rice imports for the
Ivory Coast averaged 69 percent of the total expenditure on imports
of major grain cereals. Rice imports, as a proportion of total
cereal imports, ranged from a high of 97 percent in 1963 to a low
of 40 percent in 1967. Such a situation has raised serious questions
for a number of west African countries, since rice, unlike wheat,
can be produced under a wide range of ecological conditions in these
countries.
In discussing the performance of the food crop economy of the
Ivory Coast over the 1950-1965 period, Amin [4, p. 77] writes:
The share delivered by the countryside to the cities
did not grow evenly according to commodities. The
quantity of cereals remains low and resorting to
imports happens to be essential here. The one for
roots and starchy commodities meet the need of local
urban areas, the same thing is true for fruits and
vegetables, for which the need for imports is directed
to luxury commodities.
Going further in his analysis, Amin [4] indicates that the origin
of the cereal deficit in the south, where export crops are mainly
grown, is related to the fact that residents have changed their
consumption pattern from root commodities to rice. He attributes
this change to social customs, which associate a certain level of
prestige with rice consumption. He argues that [4, p. 951:
It remains that if the southern populations had to
produce the quantity of cereals needed to feed
themselves, they would not have succeeded so easily
in producing such quantities of coffee and cocoa
without changing their mode of production, without
intensifying their agriculture and working much more.





















Table ll.--Import quantity and value of major grain cereals, Ivory Coast, 1960-1972



Cowmodities 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972


----------------------------------------------untty (n metric tons)-----------------------------

Whear 4,788 5,371 4,069 1,323 70,974 63,626 72,827 61,711 63,998 47,482 77,880 30,380 74,982
C.)n -2 -- -- -- 99 494 16 36 6,947 4,593 1,639 30
Kice 35,500 50,500 47,800 33,700 62,700 68,600 83,179 24,066 47,226 55,612 78,785 97,255 77,122
other cereal 10 34 -- -- 8 10 130 28 88 20 98 44 3
'L1.al 40,300 55,905 51,869 35,023 133,781 132,436 156,630 85,821 111,348 110,061. 161,356 129,318 152,137
Kice as propoc- ------------------------------------------- ------ Percent------------ ---------------------------
ciod of total
qur.ticy 88.0 90.0 92.0 96.0 47.0 52.0 53.0 28.0 42.0 51.0 49.0 75.0 51.0

------------------- --------------------------Value (in millions CFA francs)-----------------------------


Wheat 162.0 190.0 144.0 34.0 1,001.0 1,311.0 1,497.0 1,283 1,372.0 1,154.0 1,507.0 734.0 2,096.0
Corn 0.073 0.012 -- -- 2.0 -- 10.0 2.0 4.0 153.0 112.0 39.0 4.0
Rice 867.0 1,201.0 1,577.0 1,045.0 2,060.0 2,4-6.0 3,113.0 875.0 1,872.0 1,87b.0 2,033.0 2,204.0 2,41/.0
Other cereals 0.5 1.5 -- -- 1.0 1.0 3.0 1.0 2.0 4.0 2.0 2.0 1.0
AlL Items 1,030.0 1,392.0 1,661.0 1,079.0 3,064.0 3,798.0 4,623.0 2,161.0 3,250.0 3,187.0 3,654.0 2,979.0 4,518.0
Rice as propur- ----------------------------------------- -----Percent------------------ ---------Per--
tioi of total
v-.u 84.0 86.0 91.3 97.0 67.0 65.0 67.0 40.0 58.0 59.0 56.0 74.0 53.0


Source: [33, 39].


-- --


-- ---










Dumont [13, p. 84], addressing the specific problem of rice production
in the northern region of the Ivory Coast, writes:
As export crops available to the north besides cotton
and tobacco, rice comes in first place and needs to
have its transportation conditions toward urban areas
improved. It would be better to use the profit realized
by the Caisse de Perequationi/to improve much more
domestic rice growing conditions than subsidizing
imports of rice.

Ruttan's [45, p. 155] description of rice production and con-
sumption in southeast Asia dramatically illustrates the situation in
the Ivory Coast. He writes:
The rate of growth of crop output has in most developing
countries failed to equal the rate of growth of demand.
Furthermore, relatively large share of the production
increases that have occurred, even in densely populated
countries, have been based on expansion of area planted
rather than on yield increases.


CONCEPTUAL FRAMEWORK AND
ANALYTICAL MODELS


The early portion of this section formulates a series of hypo-
theses pertinent to rice production and consumption, and examines
the problems of substitution among factor inputs, on the one hand,
as well as that of product substitution, on the other hand. The
latter portion specifies the analytical models and operational pro-
cedures used to meet the objectives of the study.


Conceptual Framework


Some Relevant Hypotheses and Theory Relating to Rice Production and
Consumption

Since the primary focus of this research is on small farm rice
economy, it seems appropriate to state a basic set of hypotheses
regarding production and consumption behavior. These are:


--The Caisse de Per6quation is similar to a Rice Marketing Board.











1. Farmers growing rice will be more likely to increase their
production of rice if the relative price of rice to producer is more
attractive.
2. Under conditions of scarce land resource, those farmers
growing rice in combination with other crops, will tend to reallocate
the more productive land to higher value cash crops and maintain
marginal land for rice production.
3. With a process of land allocation which takes land away from
rice cultivation, if the level, quality and timing of a rice input
such as fertilizer, a partial land substitute, is poor, the produc-
tivity of the rice subsector is likely to be adversely affected.
4. If a food commodity with a relatively higher income elas-
ticity experiences persistent shortages over a certain period of
time, consumers will be more likely to shift to more readily avail-
able commodities, even if those commodities have a lower income
elasticity.
In addition to the above hypotheses it will be assumed in the
present study that:
1. Shortages of fertilizer in the rice subsector will be
experienced as long as its marginal value product in growing other
cash crops is higher than the one in growing rice.
2. In addition to the use of new inputs, such as fertilizer,
high yield seeds, and improved production techniques, the creation
of efficient marketing systems for products and factor inputs will
tend to increase producer prices and general consumer welfare.
Assumption 2 refers to the question of possible second generation
problems associated with increased agricultural productivity resulting
from green revolution technology [14].
The two substitution phenomena addressed in hypotheses 3 and 4
are:
1. Substitution among traditional factors of production and
improved factors generally associated with green revolution technology.

2. Substitution among farm commodities at the consumer level.










Dumont [13, p. 84], addressing the specific problem of rice production
in the northern region of the Ivory Coast, writes:
As export crops available to the north besides cotton
and tobacco, rice comes in first place and needs to
have its transportation conditions toward urban areas
improved. It would be better to use the profit realized
by the Caisse de Perequationi/to improve much more
domestic rice growing conditions than subsidizing
imports of rice.

Ruttan's [45, p. 155] description of rice production and con-
sumption in southeast Asia dramatically illustrates the situation in
the Ivory Coast. He writes:
The rate of growth of crop output has in most developing
countries failed to equal the rate of growth of demand.
Furthermore, relatively large share of the production
increases that have occurred, even in densely populated
countries, have been based on expansion of area planted
rather than on yield increases.


CONCEPTUAL FRAMEWORK AND
ANALYTICAL MODELS


The early portion of this section formulates a series of hypo-
theses pertinent to rice production and consumption, and examines
the problems of substitution among factor inputs, on the one hand,
as well as that of product substitution, on the other hand. The
latter portion specifies the analytical models and operational pro-
cedures used to meet the objectives of the study.


Conceptual Framework


Some Relevant Hypotheses and Theory Relating to Rice Production and
Consumption

Since the primary focus of this research is on small farm rice
economy, it seems appropriate to state a basic set of hypotheses
regarding production and consumption behavior. These are:


--The Caisse de Per6quation is similar to a Rice Marketing Board.










Dumont [13, p. 84], addressing the specific problem of rice production
in the northern region of the Ivory Coast, writes:
As export crops available to the north besides cotton
and tobacco, rice comes in first place and needs to
have its transportation conditions toward urban areas
improved. It would be better to use the profit realized
by the Caisse de Perequationi/to improve much more
domestic rice growing conditions than subsidizing
imports of rice.

Ruttan's [45, p. 155] description of rice production and con-
sumption in southeast Asia dramatically illustrates the situation in
the Ivory Coast. He writes:
The rate of growth of crop output has in most developing
countries failed to equal the rate of growth of demand.
Furthermore, relatively large share of the production
increases that have occurred, even in densely populated
countries, have been based on expansion of area planted
rather than on yield increases.


CONCEPTUAL FRAMEWORK AND
ANALYTICAL MODELS


The early portion of this section formulates a series of hypo-
theses pertinent to rice production and consumption, and examines
the problems of substitution among factor inputs, on the one hand,
as well as that of product substitution, on the other hand. The
latter portion specifies the analytical models and operational pro-
cedures used to meet the objectives of the study.


Conceptual Framework


Some Relevant Hypotheses and Theory Relating to Rice Production and
Consumption

Since the primary focus of this research is on small farm rice
economy, it seems appropriate to state a basic set of hypotheses
regarding production and consumption behavior. These are:


--The Caisse de Per6quation is similar to a Rice Marketing Board.









Factor-Factor Substitution


Factor-factor substitution could be a relatively important
phenomenon in Ivory Coast agricultural economy. The possibility of
such a phenomenon occurring on a large scale in rice production is
suggested by the trends in Table 6. Specifically, the table shows
a persistent decline in the hectareage of land committed to rice
production over the 1967-1972 period. Concurrently with the decline
in land input, there is indication of a slight increase in the
average yield per hectare over the period. To what extent are the
trends indicative of other factors being substituted for land in
rice production? Or more specifically, to what extent was ferti-
lizer substituted for land in the Ivory Coast rice production system?
Empirical studies by Heady and Tweeten [25], in Iowa, Mississippi,
Kansas and North Carolina, showed that fertilizer is a substitute
for land and labor. As a land substitute, they suggest that the
Gross Marginal Rate of substitution of fertilizer nutrients for
land varies with the soil type, rainfall, crop, climate and other
environmental factors. It also varies with the ratios in which
fertilizer and land are used under any unique combination of these
factors. They concluded [25, p. 113], that:
Hence, a single major factor seldom is substituted for
a single other factor in agriculture. However, the
"gross" marginal rates of substitution of fertilizer (as
a technology and resource) for land are of importance
or relevance. Given a favorable supply price for the
"fringe" resources which complement either fertilizer
or land, national policy or planning still is concerned
about the rate and extent to which a major resource
such as fertilizer can substitute for a "fixed" resource
such as land.

The study presented empirical evidence that fertilizer is also a
substitute for labor. In this regard Heady and Tweeten [25, p. 113]
write:
Here we refer to labor which is associated marginally
with land, in the sense that if we replace an acre of
land by fertilizing remaining acres at higher levels
we also displace the constant quantity of labor required
to handle the displaced land. As a given output is
produced by diverting some land from production and
producing more on fewer acres at higher yields, some









of the displaced labor (attached to the displaced
land) is offset by the added labor required to harvest
and handle the higher yield on the remaining acres
as well as by some added labor for applying the
fertilizer.

One very important finding in the Heady-Tweeten study is that
the additional labor required to harvest, apply fertilizer and handle
the higher yield on the remaining acres, will be negligible under a
high level of mechanized farming system, such as the one in the
United States. On the other hand, in developing countries the
impact of such additional labor is likely to be highly significant,
primarily because of the low level of mechanization.
The use of factor input, such as fertilizer, is not new in the
Ivory Coast. However, its usage has been primarily associated with
the production of traditional export cash crops such as coffee and
cocoa. The introduction of fertilizer into rice production did not
occur, to any appreciable degree, until the early 1960s. This
raises the question as to whether this development is associated
with the observed decline in land input.


Commodity-Commodity Substitution


Certain basic economic relationships exist between the quantity
supplied, the marginal cost from increasing input and the final
price of farm commodities. Farmers will be reluctant to purchase
any single input or combination of inputs if there is a high degree
of uncertainty regarding the unit output price and the overall
profitability of the enterprise in which the factors are used. In
the case of the Ivory Coast, this relationship suggests that farmers
will not simply produce commodities because the nation needs higher
production levels or urban people are discontent with higher food
prices as a result of scarcity. Positive supply response will only
be forthcoming if farmers perceive that it is profitable to do so.
Within the context of new resources allocated to the production of
specific commodities, such as fertilizer to rice production,
increased use of such inputs will only be forthcoming if the
increase in the unit price of the product more than offset the









increase in the unit cost of the new input.
The single most important new input in domestic rice production
is fertilizer. Since the Ivory Coast is a net importer of fertilizer,
it is possible that fluctuations in the in-country price of ferti-
lizer could be related either to the international market structure
or to domestic market conditions. In any case, and depending on the
extent to which fertilizer is being used, a rise in the price of
fertilizer will, ceteris paribus, tend to raise the price to con-
sumers of the commodities produced with fertilizer usage. This is
based on the economic reasoning that an increase in the price of
fertilizer would increase in turn the marginal cost of producing
rice, and hence the price of rice.
For consumers, given that rice is a major wage good in the Ivory
Coast, any substitution effect working against rice consumption could
be explained, to a great extent, by the price level of rice, relative
to rice substitute commodities, as well as basic changes in consumer
preferences. A thorough study of the preference structure of
consumers would facilitate the formulation of a set of hypotheses
as to whether or not the aggregate consumer utility function is a
separable function or not. If empirical results suggest that the
utility function is separable, further hypotheses will have to be
formulated and tested as to whether or not we are dealing with a
weak separability case or a strong separability case.
Generally speaking, weak separability of utility function is
defined in terms of the marginal utility of a commodity in one
group being different from the marginal utility of another commodity
in the same group [44, p. 69]. A pioneering work on weak separability
of utility function was done by Strotz in his 1957 article [46].
The weakly separable utility function appears in the terminology
introduced by Strotz, as a utility tree with branches. Weak
separability then became of great interest to the economist as a
prerequisite for the consistency of the two-stage maximization
procedure. According to Strotz, households proceeds towards utility
maximization in two steps. The first step is an optimal allocation
of income among broad commodity groups corresponding to 'branches'
of utility function. There is thus a budget allotment to each branch.









The second step involves the optimal spending of each budget allot-
ment within its budget constraint.
Gorman [23, 24] and Strotz [46] showed that the two-stage
budget allocation procedure has to be based for three or more groups,
on a strongly separable utility function. However, Blackorby et al.
[8] argue that the Strotz-Gorman conditions refer only to the
existence of group price indices. They then proceed to show that
the budgeting procedure described by Strotz is consistent if, and
only if, the utility function is weakly separable.
The weak separability treatment of utility function gives a
more realistic overview of the structure of consumer preferences.
As such, it provides a more appropriate conceptual framework for
discussion of complementarity and substitutability. A brief review
of the traditional definitions of those characteristics is presented
below.


Cardinal utility theory


According to the Cardinal definitions of utility theory the
second order cross partial derivatives of the utility function is
the key indicator. Hence, with an utility function such as:
U= f(Xi, Xj, Xk, X, Xm)


with Xi, Xj belonging to group A (food item) and Xk, Xl, Xm belong-
ing to Group B (non-food item),

d2U
U = 0 will imply independence between Xi and Xj and
d d .
xi xj


d2U
d2U > 0 will imply complementarity between Xi and X
d d .
xi xj
while


d2U < 0 will imply substitutability between Xi and Xj.
dxi dxj


According to the cardinal definitions, two commodities are substitutes








if the increased consumption of one decreased the marginal utility
of the other, and vice versa. This definition probably corresponds
to our intuitive concept of substitutability. However, the signs
of these cross partial derivatives are only invariant under linear
transformations, but not under monotonic increasing transformations
of the utility functions [44, p. 78].


Ordinal utility theory


From the ordinal utility function point of view, the derived
demand equations have the advantage of being invariant under any
monotonic increasing transformation. As a consequence of this,
the derivatives, and specifically the substitution effects of the
demand equations, are invariant. Furthermore, the signs of the
cross-substitution effects are not only invariant, but also undeter-
mined. This means that they can be positive, negative or zero.
The advantage of this is that one might use the cross-substitution
effect, Kij, in the so-called 'Slutsky equation' 0/and say that
i and j are substitute whenever Kij is positive [44, p. 78].
Assuming that we have the following demand function:
Xi = (Pi' Pj Pk PI, Pm, Y)

where, the P's are the relevant prices of the bundle of
commodities entering the preference schedule of the consumer and
Y being the income. The Slutsky equation for the case where the
price of another good Pj varies is:


8Xi Kij Xj Xi
apj Y

where, Kij= dXi)
dPj Y,

with the underlying condition that income is held constant. The


10/Slutsky was the first to show that the reaction of the quantity
demanded of a good to a change in its price or to change in the price
of any other good can be decomposed into an income effect and a
substitution effect [44].









ordinal hypothesis suggests then that:
Kij>O implies substitutability between commodities i and j.

Kij j.
Kij=O implies independence between the two commodities i and j.
It should be noted, however, that independence here is not defined
by the fact that the demand for commodity i is independent of the
price of commodity j.
Barten [6] has formulated a procedure for reconciliation of
the cardinal and ordinal treatment of substitutability, comple-
mentarity and independency. However, this procedure will not be
used in this study, since it requires the development of an aggre-
gate utility function which is beyond the scope of the present
study. Therefore, our theoretical framework is based on the following
assumptions:
1. Rice consumers in general have an aggregate utility func-
tion U, which is continuous and twice differentiable. Also, the
function has the normal property of decreasing, but positive
marginal utility of income (Ul>0 and U2<0).
2. Exchange transactions occur in a highly monetized economy
with limited practice of barter.
Given the above assumptions, attempts will be made to estimate the
aggregate demand function for rice in the Ivory Coast, to the extent
that this demand function can serve as a proxy for a derived demand
function as specified in utility theory. Coefficients exhibited
by such a demand function are expected to give important insights
into the question as to whether or not there is substitutability or
complementarity between rice and other commodities in the consumer
bundle of food commodities.
Table 5 shows that 1967 domestic production, representing 90
percent of the total rice available to the country, had a fall in
share in 1968 and 1969, then held fairly constant at 70 percent until 1972.
The same trend was exhibited by rice imports (Table 5). These
patterns could suggest, as mentioned earlier, that substitution
might be occurring between rice and other commodities. If price and
quantity for substitute commodities should move together, as stated









by economic theory, then one might expect the price of rice to the
final consumer to move together with the quantities consumed of the
rice substitute commodities.


Analytical Models


Since the focal point of the study has to do with the produc-
tion and consumption characteristics of the rice economy, the
specific empirical models used in the analysis are keyed to meeting
each of the four objectives given earlier.
Objective 1: Objective 1 is aimed at assessing the impact of prices
to producers for rice and prices for the major export cash crops on
domestic rice production, and the relative levels of land allocated
to these crops on the level of domestic rice production. The fol-
lowing estimating equations are expected to meet this objective.


QRT = f(PRG1, PEG1, ART, AET, FRT, RT, T, UT) (1)
where,
QRT = quantity of rice produced in period t, in thousand
metric tons.
PRG1= average price to producers for rice in period t-l, in

thousand CFA francs per ton.
PEG1= average price to producers for export crops in period
t-l, in thousand CFA francs per ton.
ART = area under rice cultivation in period t, in thousands
of hectares.
AET = area under export crops cultivation in period t, in
thousands of hectares.
FRT = quantity of fertilizer used for rice cultivation in
period t, in metric tons.
RT = average rainfall in period t, in millimeters.
T = the time trend.
UT = the error term in period t.
and,
QRT = f(PRG1, RRT, RET, FPT, RT, T, UT) (2)
where,
QRT, PRG1, RT, T, and UT are as defined in equation (1).









RRT = average gross return of rice per hectare.in thousand CFA
francs, in period t.
RET = average gross return of export crops per hectare in
thousand CFA francs, in period t.
FPT = average price of fertilizer in thousand CFA francs per
metric ton, in period t.
The coefficients of PRG1 in equations (1) and (2) will give
the impact of the price of rice to producer in period t-l, on the
quantity of rice produced in period t. The coefficient of PEGI in
equation (1) will give information on the effects of the average
lag-prices of export crops on the current quantity of rice produced.
Coefficients of ART and AET in equation (1) will indicate the re-
sponsiveness of the quantity of rice produced, relative to changes
in hectareage devoted to rice and export cash crops. The coeffi-
cients of FRT, FPT, RT and T are expected to carry.positive signs.
Furthermore, the coefficients of FRT in equation (1) and FPT in
equation (2) will give valuable information regarding the economic
of fertilizer use in rice production.
Objective 2: A simple estimating model will be used to meet objective
2. This model was initially developed by Ohkawa [43], and has been
used by many economists, including Johnston and Mellor [26]. The
model expresses the average annual growth rate in demand for food as
a function of the rate of growth of population, per capital income,
and the income elasticity of demand for food. In the case of domestic
demand for rice, we have the equation:


EGDR = PN + IER IPC (3)


where,
EGDR = the annual rate of growth in domestic demand for rice.
PN = average annual rate of growth in the population.
IER = income elasticity of demand for rice.
IPC = rate of growth in per capital income.
Objective 3: A similar model to equation (3) is used to meet the
third objective. It should be pointed out however, that in our
discussion of investment, we are primarily concerned with such









factors as capital, land, labor, transportation, storage facilities,
research and development resource allocation among crops. Hence,
an identity between annual rice demand growth rate and annual supply
growth rate will give us the relevant insight for the third objective.
This identity is expressed as:
PN + IER IPC = SRD + SRF (4)
where,
PN, IER, IPC are as defined in equation (3)
SRD = annual growth rate for domestic rice production.
SRF = annual growth rate of rice import.
Any disequilibrium working against the domestic supply will be assumed
to stem among other things from the lack of the necessary investments
needed to increase domestic rice production, relative to export crops.

Objective 4: In meeting this objective it is necessary to recall
that economic theory demonstrates that price and quantity for sub-
stitute commodities tend to move together. The implication of this
characteristic is that if the quantity of rice demanded has declined
primarily because of relative increases in the price to consumers,
the quantity consumed of the substitutes for rice must have risen.
In order to determine which commodity is likely to be a substi-
tute for rice the following quantity demand equation is developed:


LNQDRT = f(LNPRT, LNPWFT, LNPYT, LNPPT, LNPCFT, LNPMT
LNPCAT, LNAIPCT) (5)


where,
LNQDRT = the common logarithm of the quantity of rice demanded
at period t, in thousand metric tons.
LNPRT = the common logarithm of the average price of rice at
period t, in CFA francs per kg.
LNPWFT = the common logarithm of the average price of wheat
flour at period t, in CFA francs per kg.
LNPYT = the common logarithm of the average price of yam at
period t, in CFA francs per kg.
LNPPT = the common logarithm of the average price of plantain
at period t, in CFA francs per kg.







46

LNPCFT = the common logarithm of the average price of corn
and corn flour at period t, in CFA francs per kg.
LNPMT = the common logarithm of the average price of millet
at period t, in CFA francs per kg.
LNPCAT = the common logarithm of the average price of cassava
and cassava products at period t, in CFA francs
per kg.
LNAIPCT = the common logarithm of the average per capital
income, at period t, in CFA francs.
This procedure is convenient because the magnitude and signs of
coefficients for LNPWFT, LNPYT, LNPPT, LNPCFT, LNPMT, and LNPCAT
will indicate whether or not rice, wheat, yam, plantain, corn and
corn flour, millet, cassava and cassava products are complements or
substitutes. In addition, this double logarithmic function is
expected to give statistically good estimates as suggested by
George and King [22, p. 37].
With respect to the general objective, the empirical findings
from the various models are expected to provide significant insights
into the critical problem areas, and provide the background for
advancing a series of alternative policies and strategies for
meeting national goals.


ANALYTICAL PROCEDURES AND EMPIRICAL
RESULTS


Procedure Adjustments


The existence of certain gaps in the selected data series
necessitated the application of a number of econometric procedures
for dealing with missing data. For example, zero-order regression
procedures as suggested by Maddala [29, p. 202] is used as dic-
tated by the nature of the missing series. Such a method was
basically applied to missing data relevant to quantities and
average prices of fertilizer from 1960 to 1963. The procedure was
also used for data related to the prices to consumer for some
commodities, such as yam, corn flour and millet, for the years
1960 and 1961, and plantain for the years 1960, 1961 and 1965 and
1966.







46

LNPCFT = the common logarithm of the average price of corn
and corn flour at period t, in CFA francs per kg.
LNPMT = the common logarithm of the average price of millet
at period t, in CFA francs per kg.
LNPCAT = the common logarithm of the average price of cassava
and cassava products at period t, in CFA francs
per kg.
LNAIPCT = the common logarithm of the average per capital
income, at period t, in CFA francs.
This procedure is convenient because the magnitude and signs of
coefficients for LNPWFT, LNPYT, LNPPT, LNPCFT, LNPMT, and LNPCAT
will indicate whether or not rice, wheat, yam, plantain, corn and
corn flour, millet, cassava and cassava products are complements or
substitutes. In addition, this double logarithmic function is
expected to give statistically good estimates as suggested by
George and King [22, p. 37].
With respect to the general objective, the empirical findings
from the various models are expected to provide significant insights
into the critical problem areas, and provide the background for
advancing a series of alternative policies and strategies for
meeting national goals.


ANALYTICAL PROCEDURES AND EMPIRICAL
RESULTS


Procedure Adjustments


The existence of certain gaps in the selected data series
necessitated the application of a number of econometric procedures
for dealing with missing data. For example, zero-order regression
procedures as suggested by Maddala [29, p. 202] is used as dic-
tated by the nature of the missing series. Such a method was
basically applied to missing data relevant to quantities and
average prices of fertilizer from 1960 to 1963. The procedure was
also used for data related to the prices to consumer for some
commodities, such as yam, corn flour and millet, for the years
1960 and 1961, and plantain for the years 1960, 1961 and 1965 and
1966.









The double logarithmic form was chosen for equations (1) and
(2) used to meet the first objective of the study. This particular
form provided a better statistical fit and theoretical consistency
than the simple linear, semi-logarithmic or quadratic forms. The
superior fit was established through a series of trial runs with
alternative functional forms in which the double logarithmic
function consistently gave higher R2 values and higher significance
levels.
As indicated earlier, the double logarithmic function was also
used to estimate equation (5) for the fourth objective. The choice
of this particular functional form was based on the same rationale
as stated above, with respect to superiority of fit and consistency
with economic theory. The quantity of rice demanded for a particular
year was estimated as a summation of 85 percent of the domestic rice
production and the quantity of rice imported. The 85 percent figure
of domestic production, representing its share in meeting the domestic
demand, is the figure adjusted for an assumed 15 percent of domestic
rice production assigned to the account of losses and quantities
remaining on the farm for all purposes. Such a procedure was recom-
mended by Amin [4] and was used in a 1977 study conducted by the West
African Rice Development Association (ADRAO) [2].
Consumer price indices were used to deflate the commodity price
and income that are used as explanatory variables in the empirical
model for meeting objective four. These indices were developed
beginning in 1960, for European and African families by the Ministry
of Planning of the Ivory Coast (Tables 12 and 13). The averages
of these two categories of indices were used over the 1962-1972
period as a price and income deflator in the present study. For the
years 1960 and 1961 only indices for African family were used, given
that the development of indices solely for European family was
initiated in 1962. The deflated prices and income will then be
determined as follows:


DPit = Pit x 100 (6)
It













Table 12.--Average consumer price indices for European family, Ivory Coast 1962-1972/




Items in
the "basket" 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972


------------------------------------------Percent--------------------------------

Food 105 106 110 115 119.2 119.5 120.5 123.6 129.2 136.1 142.8

Water, gas,
electricity 99 99 98 98 95.1 94.2 94.1 95.7 97.7 99.0 104.4

Clothing 116 121 124 130 133.3 128.3 144.1 145.8 150.5 153.8 154.1

Health or
medicare 113 114 115 119 122.2 123.2 145.2 150.7 157.9 166.6 171.5

Home care 110 110 117 117 117.0 120.0 125.8 130.0 149.2 153.0 153.0

Recreation,
transportation,
miscellaneous 113 115 120 124 125.4 128.3 131.4 135.0 139.1 143.4 148.4


Annual averages 108.2 109.5 113.5 118.0 121.0 122.2 126.7 129.7 136.2 141.8 147.0


/Basis: 1960 = 100.

Source: [33].














Table 13.--Average consumer price indices for African


family, Ivory Coast 1960-1972-


Items in
the "basket" 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972


----------------------------------------ercent----------------------------


Food
Housing
Water, electric-
ity, combustible,
soap
Home appliances
Clothing
Services
Miscellaneous


106.5
100.3



93.4
100.6
100.9
101.0
99.6


123.0
103.0



99.4
98.1
107.9
101.7
99.7


118.7
108.8



106.0
100.2
110.2
102.7

103.7


118.3
108.8



102.9
103.8
112.3
102.7
104.9


118.9
109.3



105.3
107.8
120.2
98.4
112.5


122.4
113.6



110.1
106.2
128.1
94.1
118.1


127.6
114.6



102.8
110.9
132.0
94.9
156.2


126.6
122.6



108.0
115.4
128.9
94.9
191.5


134.8
126.7



109.8
124.1
132.0
107.5
193.6


141.6
126.8



114.3
126.3
133.4
106.5
196.1


163.0
118.6



133.1
138.3
140.9
108.7
198.0


160.1
113.6



139.0
145.1
136.1
111.8
198.0


158.3
113.7



145.3
152.8
136.2
114.4
200.0


Annual Average 102.9 112.7 112.4 112.4 113.9 117.0 121.9 124.6 131.4 135.6 148.9 147.7 148.2


- Basis: February 1960 = 100.


Source: [33].









where,
DP = deflated price for commodity i in period t,
It
Pit = price for commodity i, in current CFA francs in
period t,
It = arithmetic average of consumer price indices for both
African and European families.
and,

DYt = It x 100 (7)
It

where,
DYt = deflated income in period t,

Yt = average per capital income in current CFA francs in
period t,
It = as defined in (5).
The income elasticity for rice is assumed to be .60 over the
period studied. This coefficient was derived from a FAO [18] study.
This estimate is used in equation (3) and (4), which are in turn
used to meet objective 2 and 3, respectively.
Rainfall estimates are computed as the annual average over the
five month rainy period running from May to September. This period
coincides with the rice farming months. The annual averages are
computed from rainfall data for seven major rice producing areas
as shown in Table 14.


Empirical Results


Relative Prices, Production, and Resource Allocation


From the estimating procedure used in equations (1) and (2),
the average lag-price of export crops (LNPEG1), the quantity of
fertilizer (LNFRT) and rainfall (LNRT), although exhibiting positive
coefficients, were not significant at the 10 percent level.
The final results of equations (1) and (2) for objective (1)
were:
LNQRT = -121.036** 2.178 LNPRGl* + .606 LNPEG1
(32.76) (.90) (.61)









where,
DP = deflated price for commodity i in period t,
It
Pit = price for commodity i, in current CFA francs in
period t,
It = arithmetic average of consumer price indices for both
African and European families.
and,

DYt = It x 100 (7)
It

where,
DYt = deflated income in period t,

Yt = average per capital income in current CFA francs in
period t,
It = as defined in (5).
The income elasticity for rice is assumed to be .60 over the
period studied. This coefficient was derived from a FAO [18] study.
This estimate is used in equation (3) and (4), which are in turn
used to meet objective 2 and 3, respectively.
Rainfall estimates are computed as the annual average over the
five month rainy period running from May to September. This period
coincides with the rice farming months. The annual averages are
computed from rainfall data for seven major rice producing areas
as shown in Table 14.


Empirical Results


Relative Prices, Production, and Resource Allocation


From the estimating procedure used in equations (1) and (2),
the average lag-price of export crops (LNPEG1), the quantity of
fertilizer (LNFRT) and rainfall (LNRT), although exhibiting positive
coefficients, were not significant at the 10 percent level.
The final results of equations (1) and (2) for objective (1)
were:
LNQRT = -121.036** 2.178 LNPRGl* + .606 LNPEG1
(32.76) (.90) (.61)













Table 14.--Five month average rainfalls, selected rice growing areas, Ivory Coast, 1960-1972


Average all
Year Odienne Korhogo Bondoukou Touba Man Daloa Gagnoa areas


------------------------------------------Millimeters---

1960 -- -- -- 936.33a/
1961 1232 733 601 762 920 657 727 804.57
1962 1263 1119 796 813 1028 901 836 965.14
1963 1171 1177 742 1076 1254 857 1167 1063.43
1964 1366 1158 602 879 1156 689 653 929.00
1965 1242 1116 726 912 1148 561 696 914.43
1966 1107 1068 839 911 1695 1200 794 1087.70
1967 1370 1012 490 1001 766 803 478 845.70
1968 1074 952 1021 950 1158 1245 824 1032.00
1969 1211 1200 337 768 887 565 1866 976.28
1970 1263 1157 482 749 755 755 667 832.57
1971 1324 915 718 637 1216 986 895 955.86
1972 1257 698 725 871 1040 672 542 829.28


a/Estimated by the zero-order


regression procedure used to handle missing data [ 29 .


Source: Computations based on data provided by [4].









+ 1.437 LNART .497 LNAET + .065 LNFRT
(.45) (.63) (.06)
**
+ .122 LNRT + .069 T
(.21) (.021)

R2 = .982 DW = 2.70

and,

LNQRT = -80.845* 1.420 LNPRG1 + 1.068 LNR
(32.76) (.47) (.29)

RT** .451 LNRET* + 1.280 LNF
(.45) (.63)

PT** + .396 LNRT + .045 T*
(.06) (.02)

R2 = .986 DW = 3.22
where,
*** = 8 coefficients significant at the 1 percent level,
** = 8 coefficients significant at the 2.5 percent level,
= 8 coefficients significant at the 5 percent level,
( ) = values in parentheses are standard errors.
The characteristics of the coefficients suggest a number of
interesting relationships between rice production and key economic
variables. First, the negative coefficient of the own price lag
for rice (LNPRG1) suggests that previous prices to producers were
having depressing effects on production. Also, the negative
coefficients for variables such as area under export crops
cultivation (LNAET), and return to export crops (LNRET), suggest
that these variables were working against domestic rice production.
On the other hand, the lag price for export crops (LNPEGl), the
return to rice (LNRRT), the area under rice cultivation (LNART),
the price of fertilizer (LNFPT), rainfall (LNRT), and the time trend
(T), were found to be exhibiting positive effects on rice production.
Why would there be a negative relationship between the previous
years average price for rice and the quantity of rice produced in
any given year? This relationship probably can be explained by
farmers response in the aggregate to certain historical trends in
rice prices. Table 15 reveals that there has been a fairly extended














Table 15.--Average prices to producers for selected export cash crops and rice, Ivory Coast, 1960-1972




Year Coffee Cocoa Banana Pineapple Cotton Tobacco Palm Rice


--- ------------------------CFA francs per metric ton------------------------------------

1960 98,862 91,000 19,807 13,477 29,516 84,270 3,156 18,000
1961 90,443 72,540 18,265 13,503 31,603 80,552 3,134 18,000
1962 78,013 65,997 15,628 13,435 33,754 91,273 3,191 18,000
1963 77,665 69,598 21,679 12,807 30,667 95,918 3,175 18,000
1964 92,000 71,998 25,143 11,315 33,772 89,081 3,260 18,000
1965 89,911 63,897 21,135 11,841 35,368 90,000 3,131 18,000
1966 78,025 69,551 19,566 11,785 36,600 89,216 3,389 18,000
1967 94,508 74,276 15,060 11,459 39,703 73,016 3,475 18,000
1968 93,033 73,873 15,488 10,623 33,216 70,831 3,386 17,500
1969 94,103 79,166 19,002 11,814 33,298 72,036 3,518 20,000
1970 98,153 84,660 20,777 14,032 34,324 72,165 3,732 20,000
1971 106,559 85,940 20,937 14,182 38,990 73,798 3,665 20,000
1972 106,428 88,422 21,263 13,069 39,432 74,668 3,800 21,200


Source: [32 .









period when the average producer price of rice, vis-a-vis competitive
export cash crops, has held fairly constant. In light of this
historical trend there is likely to have been at least two types of
conditioned response among farmers. First, farmers could have given
up hope of expecting significant increases in rice prices and thereby
reduce acreage under rice cultivation. Second, farmers could have
shifted resources from rice production to higher priced competitive
export crops and food crops. There are strong indications that the
latter might have occurred, since the results indicate that the
area under export crops and the return to export crops were working
against domestic rice production. This aspect is discussed further
in subsequent sections. In general, however, the behavioral impli-
cations of the results verify the component of hypothesis 1 suggesting
that farmers will be more likely to increase their production of
rice if the relative price of rice to producer is more attractive.
The positive effect of the lag price for export crops on rice
production probably can be explained by the fact that rice being a
major wage good, any increase in prices to producers of export crops
will ceteris paribus, increase the income of export crops growers
and people in the plantation areas, which in turn would increase
the aggregate demand for rice. Having experienced this phenomenon
in the past, rice growers will be inclined to respond positively
to the lag of average price for export crops.
The negative sign carried by the coefficient of the average return
for export crops suggests that as return to producers of export crops
increases, rice growers will tend to shift from rice production to
export crops that are more profitable. This shift could be slow for
some crops such as coffee, cocoa and palm, but could be relatively
fast for crops such as cotton, tobacco, pineapple and banana.
Hectareage under rice cultivation is having positive and signi-
ficant effect on rice production. This finding is interesting, since
as indicated earlier, the hectareage under rice cultivation has been
declining over the 1967-1972 period, after reaching a maximum in
1967. It was also noted that average rice yields have remained
fairly constant over the same period (Table 6). Given these trends,
the sign and significance level of the rice hectareage variable
could be indicative of the expansion over the pre-1967 period (1950-1967).









Since average yields were low (less than one ton per hectare) the
increased rice output must have been primarily associated with
acreage extension as is the case in southeast Asia [44]. This
interpretation is supported by the positive but non-significance
level of the fertilizer quantity variable (LNFRT). A major insight
suggested by the negative coefficient of hectareage under export
crops cultivation is that this hectareage is working against rice
production. This relationship suggests that rice and export crops
are competing for scarce land resources. Given the observed decline
in rice hectareage and the relatively constant yields over the
1967-1972 period, it is possible that the more productive lands were
transferred to higher valued export and other domestic cash crops.
Tables 3 and 7 indicate that there were concomitant increases in
both land under cultivation and value to producer of crops such as
coffee, cocoa, cotton, palm and coconut over the 1967-1972 period.
With such a system of land resource reallocation the remaining land
used for rice production could have been marginal for that crop.
The extensive use of marginal land to produce rice for home consump-
tion and other purposes could probably explain the tendency for
declining to constant yields registered over the 1967-1972 period
(Table 6). This characteristic would tend to support hypothesis 2
regarding the tendency to reallocate scarce land resources in favor
of higher valued crops.
As far as fertilizer use is concerned, the positive price
coefficient refers to what Ferguson [19] calls the instantaneous
measure of return to scale. In fact, the coefficient exhibited by
the average price of fertilizer per ton is the reciprocal of the
elasticity of total cost for fertilizer. Let us designate this
coefficient as y7 = 1.280 and K the elasticity of total cost.
Following the Ferguson proposition would mean that K equals ,
which translates into a value of .78 ( 1 ) in the present case.
1.28s
Given the above findings, certain specific scale relationships are
suggested. The smaller the value of 87, the instantaneous measure
of return to scale, the greater is the proportional increase in
cost, relative to a given proportional increase in output. This
stems from the fact that K being expressed as a fraction, the smaller
its denominator, the greater its absolute value.









Generally speaking, the above indication is supported by pro-
duction theory, which states that B7, the instantaneous measure of
returns to scale, normally varies inversely with output. In other
words, for a small output, a7 should be greater than one (>7>1).
As output increases, y decreases to one (y=l1), and down to a
value less than one (B7 regular production law, cost first increases at a decreasing rate,
goes through a point of inflection then increases at an increasing
rate.
Computations based on our findings show that the elasticity of
the marginal cost of fertilizer was .22 over the period 1960-1972.
This figure could suggest that over the period, the use of an
additional unit of fertilizer in rice production would lead to a
less than proportionate rise in the cost.of fertilizer. More
precisely, this meant that an increase of 1 percent in the use of
fertilizer for rice from 1960 to 1972 would result in an additional
cost per unit of output of only .22 percent. The policy implication
of this finding will be addressed in subsequent sections.
The last two coefficients of equations (1) and (2) show that
the effects of rainfall and the time trend carry positive signs.
As indicated earlier, this suggest that these variables were working
in favor of rice production. The positive coefficient of the time
trend variable and its high significance at the 2.5 and 5 percent
levels in equation (1) and (2), respectively, indicate that some
improvement took place in rice production from 1960 to 1972. This
is supported by data in Table 6 and Fig. 3. However, the non-signi-
ficance of the rainfall variable in both equations suggests that the
increased rice output was not strongly associated with rainfall.


Growth in Rice Demand


The results of equation (3) shows that the annual growth rates
of demand for rice had a fluctuating trend over the 1960-61 to
1972-73 period (Fig. 5). The lowest annual growth rate (EGDR),
recorded for the period was 1.6 percent in 1964-65, while the highest
rate was 14.2 percent in 1963-64. The average annual growth rate
in demand over the entire period was approximately 7 percent (Table 16).










Percent
Annual Growth
rate
14.0



12.0



10.0



8.0



6.0




4.0



2.0



0

1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974


Figure 5. Trend of rice annual demand growth rate, Ivory Coast, 1960-61 to 1972-73.













Table 16.--Differences between aggregate domestic supply and demand growth rates for rice,
Ivory Coast, 1960-61 to 1972-73


Aggregate Supply Aggregate Aggregate Aggregate
Domestic Domestic Domestic
Total Domestic Imports Demand Supply Demand
Year (TSR) (SRD) (SRF)(EGDR) (SRD) (EGDR)

---------------- ----- ----Percent-----------------------

1960-61 39.7 -2.5 42.2 7.80 <
1960-62 42.1 47.4 5.3 2.04 >
1962-63 -33.8 4.3 -29.5 10.08
1963-64 98.7 12.7 86.0 14.22 <
1964-65 10.5 0.8 9.7 1.68 <
1965-66 30.9 10.0 20.9 6.66 >
1966-67 -44.9 26.1 -71.0 4.80 >
1967-68 101.0 5.2 95.8 10.86 <
1968-69 0.8 -17.0 17.8 7.08 <
1969-70 46.0 4.3 41.7 7.86 <
1970-71 45.3 21.8 23.5 7.08 >
1971-72 -43.1 -16.9 -26.2 2.40 <
1972-73 13.7 4.7 9.0 8.22 <


Average 23.61 7.10 16.51 7.00


Source: [ 16, 33, 471-









However, of the thirteen time periods included in the table, there
are eight periods in which the annual demand growth rate exceeds the
overall average. Intra-period variation in the annual growth rate
of rice demand probablyreflect a direct relationship with changes
in the intra-period rate of growth in per capital income. Since the
population growth rate and income elasticity for rice were held
constant over the entire period, this means that the variation in
demand growth rate was associated with variation in per capital
income growth rate. Specifically, when the annual growth rate of
per capital income increases or decreases, the gross annual growth
rate of demand for rice would tend to increase or decrease likewise
(Table 17).
The obvious strong relationship between income and the demand
for rice should not be interpreted to mean that population and con-
sumer tastes and preferences are not important constituents of demand
changes in the Ivory Coast. On the contrary, these variables have
to be accorded high priority in development planning within a dynamic
framework. In fact, data published by the World Bank [50] indicate
that the average annual population growth rate was 4.2 percent over
the 1970-1975 period. What the findings in the present study do
suggest, however, is that increased effective demand is a vital com-
ponent of food (rice) expansion programs. Increases in effective
demand are accomplished by improvement in the income position of a
wide segment of the population. This means that special attention
must not only be given to efforts to increase and sustain growth in
national income, but to how that income is distributed among the
population.


Rice Supply and Demand Equilibrium


As stated earlier, the estimating procedure used in equation
(4) to meet the third objective is an identity between the annual
domestic rice demand growth rate and the annual rice supply growth
rate. The result of such a procedure provided important insights as
to the extent to which a persistent disequilibrium existed between
domestic rice supply growth rate and the rate of growth in rice
demand.













Table 17.--Estimates of average population, average per capital income, aggregate demand growth
rates, income elasticity, Ivory Coast, 1960-1972




Average population Income elasticity Average per Aggregate demand
annual growth rate for rice capital income
Years (PN) (IER) (IPC) (EGDR)


-----------------------------------Percent------------------------------------

1960-61 3.0 60.0 8.0 7.80
1961-62 3.0 .60.0 -1.6 2.04
1962-63 3.0 60.0 11.8 10.08
1963-64 3.0 60.0 18.7 14.22
1964-65 3.0 60.0 -2.2 1.68
1965-66 3.0 60.0 6.1 6.66
1966-67 3.0 60.0 3.0 4.80
1967-68 3.0 60.0 13.1 10.86
1968-69 3.0 60.0 6.8 7.08 .
1969-70 3.0 60.0 8.1 7.86
1970-71 3.0 60.0 6.8 7.08
1971-72 3.0 60.0 -1.0 2.40
1972-73 3.0 60.0 8.7 8.22


Average 3.0 60.0 6.6 7.0


Source: [16, 33, 47].









The average growth rate for domestic supply was 7.10 percent
over the 1960-61/1972-73 period (Table 16). However, the yearly
distribution around that average varied widely. The dispersion
varied from a -17 percent in 1968-69, to a 47 percent ih 1961-62.
The annual disequilibrium was detrimental to the supply side on
nine occasions from 1960 to 1973. This meant that domestic supply
growth rate exceeded the demand growth rate in.only four of thirteen
cases (Table 16). Gaps created by disequilibrium against the supply
side were being met by rice imports. These findings suggest that
the domestic rice production system was exhibiting insufficiency or
inefficiency in resource allocation in land, research, education
and training, transportation and marketing, without which any attempt
to increase domestic rice supply was likely to fail.


Rice Substitutes and Complements


From the estimating procedure specified in equation (5), the
following final results were obtained with respect to objective 4:
LNQDRT = 1.256 .069 LNPRT .182 LNPWFT
(8.03) (.22) (.15)

+ .382 LNPYT .078 LNPPT .399 LN
(.18) (.15) (.19)

PCFT* .140 LNPMT + .600 LNAIPCT***
(.17) (.17)

R2 = .956 DW = 2.636

where,
*** = 3 coefficient significant at the 5 percent level,
** = 6 coefficient significant at the 10 percent level,
( ) = values in parentheses are standard errors.
The average price of cassava and cassava products (LNPCAT) was
dropped out of the final run because of multicollinearity with some
of the other independent variables such as the average prices for
yam, corn and corn flour and millet. However, the first run shows
that this coefficient although not significant at an appreciable
probability level carried a negative sign.
As stated earlier, the signs of the coefficients for the









independent variables will be the key indicators used to distinguish
the commodities that were complements from the ones that were rice
substitutes over the 1960-1972 period. The results from equation
(5) indicate that, with the exception of the average price for yam
(LNPYT) and the income variable (LNAIPCT), all the remaining
independent variables exhibited coefficients with negative signs.
This implied that, over the period 1960-1972, yam was the only
commodity used as a substitute for rice.
The coefficient of rice average own price (LNPRT) is negative
as expected. However, the magnitude of the coefficient (-.069)
suggests that rice was extremely price inelastic over the 1960-1972
period. The negative sign exhibited by wheat flour's average price
(LNPWFT) suggests that wheat flour and rice were complements. On
an a priori basis, one would expect wheat products to be substitutes
for rice because of the higher income elasticity of the former (.7),
as indicated in the study conducted by the FAO [18]. It is possible
that this result is related to the nature of the pricing data used
in the estimating equation. Specifically, the pricing data for
wheat does not include the price of other wheat products, such as
semolina and bread. In addition, the results could have been
affected by the fact that wheat prices were at the wholesaler level
rather than at the final consumer level. The choice of such pricing
data was dictated by data availability.
The positive sign of the yam price coefficient provide eco-
nomic insights in light of the fact that yam was the commodity being
substituted for rice. It implies that anytime the price of rice
rose, relative to the price of other commodities, that consumers
would move away from rice to yam consumption in such a way that the
quantity purchased of yam would move in the same direction as the
price of rice. Commodities such as plantain, corn and corn flour,
millet and cassava were found to be complements of rice.
Consumers in the Ivory Coast were assumed to spend 60 percent
of their disposable income on rice as indicated by a FAO [18] study.
The income elasticity for rice, which is given by the coefficient
of the income variable was, therefore, maintained at the 60 percent
level over the 1960-1972 period. To the extent that the assumed









income elasticity might not reflect recent changes in consumer
preferences, inferences regarding the strength of the substituta-
bility and complementarity between rice and the other commodities
should be made with caution. In fact, to be able to state that yam
and rice are strong substitutes or that rice and wheat flour, plan-
tain, corn and corn flour and millet are strong complements would
require a separate estimating equation for each commodity. If the
coefficients of the average price variable for rice in these demand
equations exhibited the same signs as wheat flour, yam, plantain,
corn and corn flour and millet in equation (5), then one could say
that yam and rice are strong substitutes, while rice and wheat flour,
plantain, corn and corn flour and millet are strong complements.
If, on the other hand, the signs of the coefficients are otherwise,
then one could say that the commodities were respectively weak
substitutes and complements.


POLICY IMPLICATIONS, RECOMMENDATIONS AND CONCLUSIONS


In this section: (a) the policy implications of the empirical
findings, in relation to the economic performance of the Ivory Coast
rice economy, are reviewed, (b) a series of policy reforms designed
to improve the overall performance of the rice subsector are pro-
posed, and (c) conclusions with respect to the important dimensions
of the study are summarized.


Policy Implications


Discussion regarding specific policy implications of struc-
tural characteristics only attain meaning with a pragmatic frame
of reference. In the case of this particular study the relevant
framework is the general objective of the study. This objective
was to formulate a series of development strategies that would
stimulate domestic rice production to levels consistent with
national self sufficiency targets in rice production. The strategy
series were to be based on the empirical findings relating to the
specific objectives of the study. Policy implications of specific
problem areas are discussed below.









income elasticity might not reflect recent changes in consumer
preferences, inferences regarding the strength of the substituta-
bility and complementarity between rice and the other commodities
should be made with caution. In fact, to be able to state that yam
and rice are strong substitutes or that rice and wheat flour, plan-
tain, corn and corn flour and millet are strong complements would
require a separate estimating equation for each commodity. If the
coefficients of the average price variable for rice in these demand
equations exhibited the same signs as wheat flour, yam, plantain,
corn and corn flour and millet in equation (5), then one could say
that yam and rice are strong substitutes, while rice and wheat flour,
plantain, corn and corn flour and millet are strong complements.
If, on the other hand, the signs of the coefficients are otherwise,
then one could say that the commodities were respectively weak
substitutes and complements.


POLICY IMPLICATIONS, RECOMMENDATIONS AND CONCLUSIONS


In this section: (a) the policy implications of the empirical
findings, in relation to the economic performance of the Ivory Coast
rice economy, are reviewed, (b) a series of policy reforms designed
to improve the overall performance of the rice subsector are pro-
posed, and (c) conclusions with respect to the important dimensions
of the study are summarized.


Policy Implications


Discussion regarding specific policy implications of struc-
tural characteristics only attain meaning with a pragmatic frame
of reference. In the case of this particular study the relevant
framework is the general objective of the study. This objective
was to formulate a series of development strategies that would
stimulate domestic rice production to levels consistent with
national self sufficiency targets in rice production. The strategy
series were to be based on the empirical findings relating to the
specific objectives of the study. Policy implications of specific
problem areas are discussed below.









Dependable and Remunerative Price Relationships


From the results of equations (1) and (2) it was shown that
previous prices to rice growers were having adverse effects on
current production. This evidence highlights the fact that the
higher and more dependable the price offered to farmers for rice,
the greater is the possibility of a positive supply response. In
other words, a remunerative price for rice to producers, like any
other farm product, is both important and necessary in increasing
the quantity produced and brought to the market. Moreover, given
the inherent year to year or preharvest to postharvest fluctuations
in farm product prices, the setting of dependable and profitable
prices to farmer becomes a requirement if the country's goal is to
increase quantities produced. The reasoning behind the dependable
and profitable prices for farm products can be understood if one
bears in mind the fact that there is a long tradition of subsistence
type of farming, where production was primarily for home consumption.
The necessity and incentive for a market oriented production system
only arose in a more recent period when the economy had achieved a
certain level of monetization. In such a newly monetized economy,
as the one of the Ivory Coast, farmers are inclined to base their
net return estimates on the actual or expected market prices of
their products. If they face unpredictable, unprofitable and
unstable prices, there will be less incentive to increase output.
The magnitude and the sign of the coefficients for the price
of rice to producer in equations (1) and (2) provide some insight
with respect to the impact of a poor pricing policy on the level of
output over the 1960-1972 period. Therefore, since farmers are
found to be highly responsive to a profitable price level and price
dependability, any policy aiming at achieving overall or subsectoral
agricultural growth must consider setting a pricing system favorable
to farmers.


Structural Bottlenecks in the Farming System


A major finding relating to land in equation (1) is that
hectareages under rice cultivation had a positive and highly









Dependable and Remunerative Price Relationships


From the results of equations (1) and (2) it was shown that
previous prices to rice growers were having adverse effects on
current production. This evidence highlights the fact that the
higher and more dependable the price offered to farmers for rice,
the greater is the possibility of a positive supply response. In
other words, a remunerative price for rice to producers, like any
other farm product, is both important and necessary in increasing
the quantity produced and brought to the market. Moreover, given
the inherent year to year or preharvest to postharvest fluctuations
in farm product prices, the setting of dependable and profitable
prices to farmer becomes a requirement if the country's goal is to
increase quantities produced. The reasoning behind the dependable
and profitable prices for farm products can be understood if one
bears in mind the fact that there is a long tradition of subsistence
type of farming, where production was primarily for home consumption.
The necessity and incentive for a market oriented production system
only arose in a more recent period when the economy had achieved a
certain level of monetization. In such a newly monetized economy,
as the one of the Ivory Coast, farmers are inclined to base their
net return estimates on the actual or expected market prices of
their products. If they face unpredictable, unprofitable and
unstable prices, there will be less incentive to increase output.
The magnitude and the sign of the coefficients for the price
of rice to producer in equations (1) and (2) provide some insight
with respect to the impact of a poor pricing policy on the level of
output over the 1960-1972 period. Therefore, since farmers are
found to be highly responsive to a profitable price level and price
dependability, any policy aiming at achieving overall or subsectoral
agricultural growth must consider setting a pricing system favorable
to farmers.


Structural Bottlenecks in the Farming System


A major finding relating to land in equation (1) is that
hectareages under rice cultivation had a positive and highly









significant effect on rice production, whereas the area devoted to
export crop production exhibited an adverse effect on rice production.
Light was shed on this matter in 1956 by Buron [11, p. 1054] who
pointed out that the use of land for production of export crops,
rather than for local food crops, is a major reason for concern
about food supplies. For him, the food supply problems were likely
to hamper economic development in French West Africa because concen-
tration on export cash crops has led to neglect of food crops.
The policy implication from such a competitive pattern between lands
allocated to export crops and rice is the development of intensive
methods of cultivation for rice, other food crops, and export crops.
The negative coefficient carried by the LNAFT variable (hectareage
under export crops), although relatively small and non-significant,
gives a positive insight as to the critical time at which the
competition between the two types of crops may become a matter of
great concern.
The coefficient exhibited by the price of fertilizer variable
(LNFPT) in equation (2) and its high significance at the 2.5 percent
level, suggests that there are sufficient sound economic reasons
for a more general use of fertilizer in the rice production system
in the Ivory Coast. The evidence that (a) the coefficient of the
fertilizer price variable called the instantaneous measure of
return to scale for fertilizer was greater than one (1.28) and,
(b) that the elasticity of the marginal cost of fertilizer was also
less than one (.22), support the policy implication that an increase
in the use of fertilizer as suggested above, is needed in order to
make its use more profitable in the rice subsector. However, since the
quantity of fertilizer variable was nonsignificant in equation (1)
the implication is that there was sub-optimum use of fertilizer in
rice production, to the extent that in the aggregate rice producers
were operating in the non-economic region of their production function.
This finding relating to the quantity of fertilizer, in conjunction
with the fairly constant yield per hectare recorded in the rice
sector from 1966 to 1972 (Table 6), support hypothesis 3.
The policy implication from the highly nonsignificant level of
the quantity of fertilizer, even though it would pay to extend its









use, suggest (a) efforts to increase the quantity of fertilizer used
in the rice subsector and, (b) an improvement in fertilizer pricing
and distribution systems in order to make it available to the small
and traditional farmers at profitable levels.
From the results of equation (3) it can be said that the basic
variables to be considered carefully in estimating the aggregate
annual demand for rice are primarily the annual growth rates for
population and per capital income, and the strength of the income
elasticity for rice. Although the annual growth rate for population
and income elasticity for rice were held constant at 3 percent and
.60, respectively, their magnitude cannot be overlooked. In fact
recent data published by the World Bank [50] show that the
population annual growth rate in the Ivory Coast averaged 4.2 per-
cent over the 1970-1975 period. However, given that the annual
growth rate for populations and the income elasticity were held
constant in the present study, the key variable appears then to be
the annual growth rate of per capital income. Therefore, if more
accurate estimates could be developed for per capital income, popu-
lation growth rates, and income elasticity for rice, more accurate
forecasts of the future demand for rice could be made.


Resource Allocation


As to the question of rice supply and demand growth rate dis-
equilibrium it was stated that any imbalance against the domestic
supply would be assumed to be strongly related to signficiant
differentials between investment efforts in export and rice crop
systems. The empirical evidence with respect to the allocation of
land to rice and export crops in equation (1) has been identified
with a competitive relationship between the two crops for land.
Besides, results from equation (4) show that the disequilibrium
between annual demand and domestic supply growth rates works nine
of thirteen periods (70 percent) against the supply side, from 1960
to 1973 (Table 15). Moreover, these disequilibria are indications
that the effective demand for rice was growing more rapidly than
domestic rice supply.
The high nonsignificance of the fertilizer quantity variable









in equation (1), in conjunction with the persistent lag of domestic
production behind the effective demand for rice in equation (4),
suggest that more investment should be made in the rice subsector
in order to increase and facilitate its productive capacity.


Product Substitutability


As to the complementarity and substitutability for rice, the
empirical findings suggested that yam was the only substitute for
rice over the period 1960-1972. In a study of the distribution of
the staple food crops in the Ivory Coast in the 1950s, Midge [31]
concluded that there was basically a fairly sharp division between
the rice region to the west and the yam region to the east of the
Bandama (Fig. 2). This feature, explained by historical and cultural
factors, has a major effect on the cropping system and consumption
pattern of the different ethnic groups in the Ivory Coast. Further-
more, Midge suggested that the dividing line between the two distinct
cultures within the country could be generalized to all of west
Africa. He writes [31, pp. 33-37]:

The Western region of West Africa is a zone devoted to
rice. There the role of the yam is strictly secondary,
so much so that the most recent agricultural statistics
for French Guinea and Senegal do not even mention its
existence. .

To this immense rice zone, is opposed the domain of the
yam. Between the Baoule and the Cameroons, the yam
becomes the essential crop about which agricultural
activities revolve. If, as happens in portions of
the region, it yields its dominant position to another
crop, its social importance remains considerable. It
manifests itself in a May festival, object of rejoicing,
which is one of the outstanding dates of the year in
the life of these tribal groups. This is the case,
for example, in the District where yams as a crop
have come to be of secondary importance.

The results of the present study support Mi6ge's findings as
to the importance played by rice and yam in consumer choices in the
Ivory Coast up to 1972. This evidence is corroborated by the sub-
stitutability of yam. The policy implication stemming from the
above findings with respect to the improvement of human nutrition









is the need to promote greater diversification in the final
consumers' food commodity bundle.


Recommendations


Dependable and Profitable Pricing System


One of the empirical findings from equations (1) and (2)
indicate that the price system depressed the domestic production
of rice over the 1960-1972 period. One insight gained from these
findings is that a remunerative price for rice is both important
and essential for the growth and development of the rice subsector.
In light of this finding, it is suggested that a positive price
system, favorable to rice growers, be devised as an integral com-
ponent of the development plan for the country's agricultural sector.
According to Krishna [28, p. 503],


If and when a positive price policy does become a
part of growth policy, it has three functions: (1)
to accelerate the growth of agricultural output as
a whole; (2) to accelerate or decelerate the growth
of the output of individual crops or, in the context
of planning, to steer the crop-mix according to
targets; and (3) to secure adequate increases in the
marketed supply of food crops in countries where a
large part of output is retained by the peasants for
home consumption.

In the case of the Ivory Coast, pricing functions (1) and (2),
as outlined by Krishna, take on a high degree of significance. Also,
given the relatively high monetized economy of the country, achieving
the third function will greatly depend on the extent to which the
other two functions have been fulfilled. It should be understood that
a high and stable price system will provide the economic incentive
to farmers to adopt the new farming technology identified with the
use of fertilizer, improved seeds, pesticide and intensive farming.
This simply means that a non-remunerative or unstable price system
for a specific farm crop will only be an impediment to any induced
investment to sustain the growth and promote the development of this
specific crop sector. Boulding and Singh [9, p. 4] depict this
aspect of the farm sector when they write:









is the need to promote greater diversification in the final
consumers' food commodity bundle.


Recommendations


Dependable and Profitable Pricing System


One of the empirical findings from equations (1) and (2)
indicate that the price system depressed the domestic production
of rice over the 1960-1972 period. One insight gained from these
findings is that a remunerative price for rice is both important
and essential for the growth and development of the rice subsector.
In light of this finding, it is suggested that a positive price
system, favorable to rice growers, be devised as an integral com-
ponent of the development plan for the country's agricultural sector.
According to Krishna [28, p. 503],


If and when a positive price policy does become a
part of growth policy, it has three functions: (1)
to accelerate the growth of agricultural output as
a whole; (2) to accelerate or decelerate the growth
of the output of individual crops or, in the context
of planning, to steer the crop-mix according to
targets; and (3) to secure adequate increases in the
marketed supply of food crops in countries where a
large part of output is retained by the peasants for
home consumption.

In the case of the Ivory Coast, pricing functions (1) and (2),
as outlined by Krishna, take on a high degree of significance. Also,
given the relatively high monetized economy of the country, achieving
the third function will greatly depend on the extent to which the
other two functions have been fulfilled. It should be understood that
a high and stable price system will provide the economic incentive
to farmers to adopt the new farming technology identified with the
use of fertilizer, improved seeds, pesticide and intensive farming.
This simply means that a non-remunerative or unstable price system
for a specific farm crop will only be an impediment to any induced
investment to sustain the growth and promote the development of this
specific crop sector. Boulding and Singh [9, p. 4] depict this
aspect of the farm sector when they write:









If agricultural prices are low, resources will move
out of agriculture but, on the other hand, investment
will not be made in it. If agriculture prices are
high, investment will be made in it but resources
will not move out of it.

Some evidences from 1972-1975 data highlight the extent to
which rice farmers in the Ivory Coast are.responsive to a profitable
price. For instance, in 1975 the increase in the production of
paddy rice was 41 percent over the 1972 level of output. At that
point in time, the average price to producer for paddy rice had
increased from 21 to 67.5 CFA francs per kg, an increase of 221
percent over the 1972 price level [32, p. 27]. This price-supply
response should serve as a basic guideline to future pricing policy
for farm products, since it indicates that even in a low income
country, farmers are responsive to price changes.
Addressing himself to this matter, Mellor [30, p. 38] writes:

Accumulating evidence for low income countries indicates
relatively high supply elasticities for individual com-
modities. In some cases farmers in low income countries
appear more responsive to relative price changes than
those in high income countries.

Regarding the specific case of staple foods in western Africa,
Johnston [27, p. 260] writes:

It is to be emphasized that the elasticity of supply
for food products is necessary greater than for total
agricultural output because of the possibility of shift-
ing land, labor resources between production of export
crops and food crops.

These findings suggest that if a dependable and profitable price
system were devised for a specific food crop sector, it could grow
more rapidly than the overall agricultural sector. Moreover, specific
findings from equation (1) indicate that the lag-price of export crops
was having nonsignificant but positive effects on rice production
through increases in demand for rice. However, if is to be borne in
mind that unless adequate price and resource allocation strategies
are developed, the increases in export crop producer income will
result in reducing supply of rice in the long run as resources shift
to export crops. This contention is supported by (a) the competitive









scheme between rice and export crops for land resources, as indicated
in equation (1), and (b) the negative effect of returns from export
crops as indicated in equation (2).


An Intensified Farming System


As pointed out earlier, a competing scheme between hectareage
allocated to rice production and area under export crop cultivation
existed over the study period. This finding, in conjunction with
the evidence that rice production was highly dependent on hectareage,
underscore the need for more intensified farming system in both food
and export crop subsectors.
The intensification scheme, in order to promote the growth and
development of the farm sector in general, and the rice subsector
in particular, should be concomitant with a land reallocation policy.
Such a policy could serve to limit hectareage allocated to specific
export and food crops. Given that in a monetized economy, with a
favorable price system farmers are more likely to increase their
income, the only alternative to achieve this goal will be to intensify
production, since a constraint would have been imposed on hectareage
expansion. However, the policy of bringing farmers from extensive
type food and export crop systems to an intensified method of farming
will succeed if there are other facilitating policies. Supporting
policies and programs would include, among other things, positive
pricing policies, new inputs, input and output subsidy, credit
facilities and appropriate marketing institutions.
The availability of new inputs is a crucial component of the
intensification program. Farmers will only use the new inputs if
they are locally available at economical prices, relative to the
expected value of the product. In the present study, the magnitude
of the instantaneous return to scale for fertilizer (1.28 ), in
conjunction with the marginal cost of fertilizer in the rice subsector,
indicates that in the aggregate it was highly economical to promote
the use of fertilizer in producing rice. However, failure to provide
the rice subsector with the appropriate amount of fertilizer depressed
its growth and development over the 1960-1972 period. The responsive-
ness of the rice subsector to fertilizer offers a solid foundation









for intensification programs in the rice production system. In light
of the aggregate fertilizer responsiveness, efforts should be made
to increase its quantity and extend its distribution in the overall
rice subsector as an integral part of the intensification program.


Subsectoral Investment Levels


If the long-term growth and development of the Ivorian export
cash crops subsector can be explained on the existence of an
effective demand for its output, then the rice subsector should also
have grown and developed for a similar reason. In fact, results
from equations (3) and (4) indicate that the effective demand growth
rate for rice exceeded the domestic supply growth rate in nine of
thirteen years, from 1960 to 1972 (Table 16). Given the existence
of such an increasing effective demand, and the inability of the
rice subsector to meet that demand, it seems reasonable to assume
that the differential performance in the export subsector and the
rice subsector were partially due to differentials in investment
levels between the two subsectors. For example, the low and sub
optimum use of fertilizer in the rice subsector supports the conten-
tions that underinvestment was a major problem in that subsector.
In light of these inferences it is suggested that investment
endeavors in research and development, transportation, storage
facilities and improved marketing channels be undertaken in order
to promote growth and development in the rice subsector. Investment
strategies relating to these components are discussed below.


Research and development


Efforts undertaken in this area should be oriented toward the
development of adaptive local varieties, highly responsive to fer-
tilizer and resistant to disease. The ultimate purpose of such an
enterprise is to make new technology available to farmers and thereby
increase their productivity. In order to be highly productive, fer-
tilizer should be used with improved varieties highly responsive to
fertilizer. Therefore, a failure to provide the new improved variety
along with fertilizer will have an adverse effect on the yield in









for intensification programs in the rice production system. In light
of the aggregate fertilizer responsiveness, efforts should be made
to increase its quantity and extend its distribution in the overall
rice subsector as an integral part of the intensification program.


Subsectoral Investment Levels


If the long-term growth and development of the Ivorian export
cash crops subsector can be explained on the existence of an
effective demand for its output, then the rice subsector should also
have grown and developed for a similar reason. In fact, results
from equations (3) and (4) indicate that the effective demand growth
rate for rice exceeded the domestic supply growth rate in nine of
thirteen years, from 1960 to 1972 (Table 16). Given the existence
of such an increasing effective demand, and the inability of the
rice subsector to meet that demand, it seems reasonable to assume
that the differential performance in the export subsector and the
rice subsector were partially due to differentials in investment
levels between the two subsectors. For example, the low and sub
optimum use of fertilizer in the rice subsector supports the conten-
tions that underinvestment was a major problem in that subsector.
In light of these inferences it is suggested that investment
endeavors in research and development, transportation, storage
facilities and improved marketing channels be undertaken in order
to promote growth and development in the rice subsector. Investment
strategies relating to these components are discussed below.


Research and development


Efforts undertaken in this area should be oriented toward the
development of adaptive local varieties, highly responsive to fer-
tilizer and resistant to disease. The ultimate purpose of such an
enterprise is to make new technology available to farmers and thereby
increase their productivity. In order to be highly productive, fer-
tilizer should be used with improved varieties highly responsive to
fertilizer. Therefore, a failure to provide the new improved variety
along with fertilizer will have an adverse effect on the yield in









the rice subsector. On the other hand, the success of the research
endeavor will result in relatively lower and profitable prices to
farmers and would be in the best interest of consumers.


Transportation and storage facilities


The underlying reasoning in favor of investing in transportation
infrastructure is that differences in transportation costs could
result in significant differences in crop profitability, even with
farms of similar physical characteristics. Developing the road
network will reduce the cost of transportation of both inputs and
products.
The problem of food commodity storage and transportation is not
new in West Africa. On the basis of his study in Ghana (the former
Gold Coast), during the 1930s, Beckett [7, p. 76] concludes;

Food problems in the Gold Coast have not been those of
production, but of distribution. Centers of increasing
population have sometimes outstripped the increase in
cultivation of foodstuffs within economic radius.

Referring to the specific case of peasants in the village of Akokoaso
in the cocoa belt, Beckett indicates that bulky food commodities,
such as plantain and cocoyam, were overproduced and much of this
production was left to spoil in the farms. He attributed this
condition to-costly and inadequate storage and transportation
facilities. For the Ivory Coast, the importance of improving rice
transportation facilities from the north toward urban areas was
emphasized by Dumont [13, p. 84] in the early 1960s.
The need for investing in well designed and adequate storage
facilities arises as a traditional farming system becomes market
oriented. One has to bear in mind that consumer demand for rice
extends beyond the harvest period. Therefore, in order to make rice
available to them all year round, rice has to be milled and stored.
In 1977, Skinner [49, p. 11] in reviewing the agricultural production
of the Ivory Coast writes:

Rice production has increased to the point of surplus
with milling and storage facilities inadequate to
handle all of the crop.









Interestingly enough, the Ivory Coast faced a severe rice shortage
in 1977. In light of the above situation, there are strong indications
that this shortage was primarily associated with underinvestment in
storage facilities on the one hand and inefficient market systems on
the other hand. Such a situation gives support to the suggestion
that the Ivory Coast is encountering to some degree "second generation
problems" of the Green Revolution as described by Falcon [14].


Efficient marketing system


Consumers are interested in minimizing cost with respect to the
quantity and quality of rice purchased and farmers are interested in
obtaining the highest possible net returns from the sale of their
rice. An efficient marketing system will serve both purposes. In
such a market oriented rice production system, it is clear that the
cash returns to producers will heavily depend on their products
reaching the final consumers. The need then for dependable marketing
channels becomes essential to effectively bridge the gap between rice
producers and consumers. This suggests that the development of an
efficient marketing system should be an integral part of the overall
subsector development strategy. An inefficient and uncoordinated
marketing system will be translated into excessive marketing costs.
High marketing costs could mean low prices to producers and high
prices to consumers. On the other hand, greater quantities are more
likely to flow through less complex and less costly marketing channels.
Therefore, the improvement and expansion of market facilities should
be concomitant with the growth in the rice subsector in order to
maintain the output momentum among rice producers. The improvement
in market facilities will not be spontaneous as a response to price
incentive, it will rather depend on marketing strategies aiming at

(a) providing market information and quality control, (b) encouraging
competitive behavior among market participants and (c) establishing
grades and standards in the best interest of producers and consumers,
to name a few.
Thus, with all the adverse situations experienced in the rice
subsector in the Ivory Coast, and because such situations do not









exist in the export crop subsector, it can safely be said that a
reasonable explanation of the inability of the rice sector to meet
the increased effective demand is in large part attributable to the
skewness in infrastructural investments in favor of the export crop
subsector.


Commodity Substitution and Nutritional Goals


It is suspected that the inability of the rice subsector to
meet the increased effective demand for rice was reflected in
equation (5) by the substitutability of a poor protein-content
commodity (yam), for rice, a relatively high protein content
commodity (Table 10). Although rice appears to be highly price
inelastic for the empirical results discussed earlier, it nevertheless
appears profitable to increase its production. This reasoning
is based on the fact that the average annual population growth rate,
the magnitude of the income elasticity for rice and the strength of
the income variable will likely shift the long-run demand upward by
such a magnitude, that the long-run decrease in price, due to an
increase in the quantity produced, will be offset by an increase in
the quantity purchased by consumers.
The tendency to substitute a poor protein content commodity for
rice could be inconsistent with national efforts to improve the
nutritional status of the population. From this point of view
increased efforts should be made to encourage the consumption of
higher protein content locally produced commodities, such as maize,
meat, milk, eggs, fish and vegetables. Each of the above commodities
exhibits a higher income elasticity than rice and yam [17, p. 174].
Therefore, if the average per capital income growth rate continues
at a level similar to or in excess of the 1960-1972 rate of 6.6
percent (Table 17), the diversification policy for the commodities
contained in the consumer bundle of food items will have a greater
chance to succeed. However, it is recommended that such a policy
be linked to the implementation of another set of policies enabling
the domestic farm sector to provide the major share of the new set
of commodities to be made available for consumers. For shifting
consumption patternsto generally higher income elasticity commodities









to be imported would lead to a drain of scarce foreign exchange
earnings needed for investment in the national economy.


Conclusions


The empirical results of the present study reveal that the
achievement of self-sufficiency in rice production for meeting the
domestic demand depends, among other things, on the implementation
of a set of positive policies relevant to the agricultural sector
in general. Policy designed to enable the rice subsector to exhibit
a positive response to the effective demand for rice would primarily
involve the implementation of a dependable and profitable price
system for farmers producing rice. Since it appears that rice and
export crops are competing for land, and because increases in rice
production are still greatly dependent on extended hectareage, a
structural change in the agricultural sector becomes a basic require-
ment for development of the rice subsector. Such a structural change
should emphasize a more intensive farming system in both the food
and export crop subsectors. Given that the suboptimal use of
fertilizer in rice production, its adoption by farmers should be
regarded as the stepping stone toward a wide range intensification
scheme. Therefore, the availability of fertilizer, along with
improved seeds to farmers, should be a primary condition to be met.
With respect to the aggregate annual demand for rice, it is
evident that maximum attention would have to be given to the income
components. Per capital income annual growth rate appears to be
among major shifters of the demand for rice. However, the population
component should not be neglected, especially in a country such as
the Ivory Coast where the population average annual growth rate is
increasing.
Findings suggest, on the one hand, that a growing income level,
in combination with a high income elasticity for rice, are associated
with an increased effective demand for rice with which domestic
production fails to keep pace. On the other hand, the inability of
the rice subsector to meet such a growing effective demand is
believed to originate from the unprofitable price system for farmers









in the rice subsector, and the low level of the necessary investment
to grow and develop the food sector in general and the rice subsector
in particular. Therefore, it is felt that a positive pricing system
along with investment to develop improved variety, adoption of
fertilizer, and building of storage facilities would improve
growth and development in the rice subsector.
Results suggest the need for policies and programs designed
to shift consumption patterns from poor nutrient content commodities
to higher protein content commodities. The policy of improving
human nutrition would involve orienting the shift from rice to more
nutritive value local commodities such as maize, meat and other
animal products, fruits and vegetables.
In general, meeting the national demand for rice without
resorting to costly imports will heavily depend on how the
recommendations relevant to the solutions to the specific
problems will be carried out. In any case, failure to develop an
adequate pricing system in the rice subsector, and undertake the
structural changes along with the necessary investments in that
subsector will simply result in persistently poor performance.















REFERENCES


[1] Adama, B., 1978, "The Economics of Rice Production in the Ivory
Coast, 1950-1972: Strategies and Policy Implications."
M.S. thesis, University of Florida.

[2] ADRAO, 1977, Perspective du Commerce intra-regional du Riz en
Afrique de l'Ouest, Monrovia, Liberia.

[3] Africa Research Ltd., 1969, Africa Research.Bulletin, June 15-
July 14, pp. 1401-1402.

[4] Amin, Samir, 1967, Le Developpement du Capitalisme en Cote d'
Ivoire, Editions de Minuit 1967, p. 77.

[5] ASECNA, 1978, Association pour la Securite de la Navigation
Aerienne, Abidjan.

[6] Barten, A. P., 1971, "Preference and demand interactions between
commodities in Schaarste en welvaart." Opstellen aangeboden
and Prof. Dr. P. Hennipman, H. E. Stenfert Kroese, 1-18.

[7] Beckett, H. W., 1944, Akokoaso: A Survey of. a Gold Coast village,
London School of Economics and Political Sciences, Monograph
on Social Anthropology, London.

[8] Blackorby, C. G.,Lady, D. Nissen and R. R. Russell, 1970, "Homo-
thetic Separability and Consumer Budgeting." Econometrica,
Vol. 38, pp. 468-472.

[9] Boulding, Kenneth E. and Pritan Singh, "The Role of the Price
System in Economic Development," in Problems of Economic
Development Series, University of Michigan (undated).

[10] Bulletin de l'Afrique Noire, 1969, Memento Statistique de 1'
Economic Africaine, a special issue #557.

[11] Buron, Robert, 1956, "Le Developpement des pays sous-d&veloppes
L'avenir de l'Afrique Noire," Etudes et Conjoncture, Ministere
desFinances et des Affaires Economiques, Institut National
des Statistiques et des Etudes Economiques, France, November
issue.

[12] Chenery, H. B., 1958, "Development Policies and Programmes,"
Economic Bulletin for Latin America, Vol. 3, pp. 51-77.









[13] Dumont, Rene, 1962, Afrique Noire Developpement Agricole-
Reconversion de 1'Economie Agricole: Guinea, C6te d'Ivoire
Mali, Press Universitaires de France, p. 84.

[14] Falcon, Walter P., 1970, "The Green Revolution: Generation of
Problems," American Journal of Agricultural Economics,
Vol. 52, pp. 698-710.

[15] FAO, 1962, Nutrition and Working Efficiency, Freedom from
Hunger Campain Basic Study, No. 5, pp. 13-27, Rome.

[16] FAO, 1967, Agricultural Commodities Projections for 1975 and
1985, Rome.

[17] FAO, 1970, The State of Food and Agriculture, Rome.

[18] FAO, 1971, Agricultural Commodities Projections 1970-1980,
Vol. II, p. 32, Rome.

[19] Ferguson, C. E., 1975, The Neoclassical Theory of Production
and Distribution, Cambridge University Press, pp. 157-168,
London.

[20] Fraternite Matin, 1976, Il n'est plus necessaire d'importer
du riz, issue of Jan. 21, p. 17.

[21] Futa, M. Tshitumbu, 1976, "Internal Agricultural Adjustment to
External Disturbances: Case Study of Export Crop Diver-
sification in Selected African Countries, 1950-1973."
M.S. thesis, University of Florida.

[22] George, P. S. and G. D. King, 1971, "Consumer Demand for Food
Commodities in the United States with Projections for 1980,"
Giannini Foundation Monograph #26, University of California.

[23] Gorman, W. M., 1959, "Separable Utility and Aggregation,"
Econometrica, Vol. 27, pp. 469-481.

[24] Gorman, W. M., 1959, "The Empirical Implications of a Utility
Tree: A Further Comment." Econometrica, Vol. 27, p. 489.

[25] Heady, E. 0. and L. G. Tweeten, 1963, Resource Demand and
Structure of the Agricultural Industry, Iowa State
University Press, Ames, pp. 109-113.

[26] Johnston, B. and John W. Mellor, 1961, "The Role of Agriculture
in Development," American Economic Review, Vol. 51, #4.
pp. 571-581.

[27] Johnston, B. F., 1958, The Staple Food Economies of Western
Tropical Africa, Stanford University Press, Stanford,
California.

[28] Krishna, Raj, 1974, "Agricultural Price Policy and Economic
Development," in Agricultural Development and Economic Growth
by Southworth and Johnston, eds. Cornell University Press,
Ithaca and London, pp. 497-538.




University of Florida Home Page
© 2004 - 2010 University of Florida George A. Smathers Libraries.
All rights reserved.

Acceptable Use, Copyright, and Disclaimer Statement
Last updated October 10, 2010 - - mvs