Agricultural futures markets in LDCs: a policy response to price volatility?

Five decades of neoliberal developmentalism in “Least Developed Countries”: A decolonial critique

“…To interpret the findings drawn from document analysis (see the Methodology section below), in addition to the theoretical ideas presented above, the paper uses some scholarly literatures that have explored the challenges faced by LDCs. Most of the scholarly publications (Dicaprio & Trommer, 2010; Fojtíková et al, 2023; Kydd & Dorward, 2004; Morgan et al, 1999; Oguledo, 1993; Thirlwall, 2007) have explored the extent to which LDCs are modernised in terms of their economic growth and development especially through international trade. They have focused on intellectual property laws (Kalanje, 2002; Miranda & Sue, 2013), the impact of global financial crisis (Bhattacharya & Dasgupta, 2012) and the COVID‐19 pandemic (Ebrahim et al, 2021), the increasing debt burden (Bjerg et al, 2011), economic and technological inequalities (Girón & Kazemikhasragh, 2022; Wakunuma et al, 2020) and the importance of public health and education (Basten & Cuaresma, 2014; Joe & Mishra, 2017).…”

“…Despite international agreements for effective implementation of financial aid (OECD, 2008; UNCTAD, 1992), almost no effort has been made to make LDCs self‐reliant. As noted by some scholars (Fialho, 2012; Santos‐Paulino, 2007), international organisations have failed to reduce poverty because support measures taken for promoting economic growth have raised only import growth (Kydd & Dorward, 2004; Morgan et al, 1999). Major organisations such as the WTO and the World Bank attach conditionalities (Craviotto & Meeks, 2021), which demand for changes in LDCs' economic policies if they violate the aid‐rules imposed by those organisations.…”

Market Reforms and Commodity Price Volatility: The Case of East African Coffee Market

“…Furthermore, the benefits not only allow efficient resources allocation among producers in the production process (Gemech et al., ), but also they outweigh the costs for most producers (Mohan, ). However, just like the non‐market measures, market‐related instruments have a number of bottlenecks, such as market thinness in developing countries, hedging costs, creditworthiness, feasibility criteria, mistrust, ignorance, basis risk and exchange rate risk (Thompson, ; Sorenson et al., ; Reinhart and Wickham, ; Morgan et al., ; Pennings et al., ; Mohan, ).…”

“…There is also a debate on the geographical location of exchanges from which hedging instruments are found (based in developed economies): whether producers in developing countries should rely on them or should establish their own options and futures exchanges. The basic prerequisites for establishment and existence of a successful options and futures exchanges have been outlines (Thompson, ; Johnson and Mcconnell, ; Tashjian, 1995, Morgan et al., ). These include demand for futures, existence of price uncertainty, asymmetries in characteristics of long and short participants, and the existence of competing contracts.…”

“…Morgan et al. () argue that the demand for futures exists since commodity prices are uncertain. This implies a shift in emphasis from unsuccessful intervention approaches that had been favoured since 1930s towards a system that allows individuals to cope with the impact of price volatility, such as commodity futures and options.…”