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Impact of Institutional and Regulatory Frameworks on the Food Crops Sub Sector: 1990 to 1999
The overall goal of the Government of Kenya is to promote and improve the
health status of all Kenyans by making health services more effective, accessible,
and affordable. To address problems in the health sector, and to make healthcare
accessible and affordable, the government, in the early year after independence,
instituted and implemented various healthcare reforms, among them setting
up of health insurance through the National Hospital Insurance Fund (NHIF).
However, the focus of NHIF has been mainly on formal sector employees. This
has left out those in the informal sector, those in agriculture, and pastoralists.
The government plans to transform the current NHIF to a National Social
Health Insurance Fund (NSHIF) as a way of ensuring equity and access to
health services by the poor and those in the informal sector, who have been left
out for the forty years that the NHIF has been in existence. In view of the
proposed transformation, this paper aims to lead policy makers and programme
planners through the process of evaluating the usefulness and feasibility of a
social health insurance system. The paper offers insight into the process of a
successful implementation of such as scheme by addressing the foreseen obstacles
and issues of desirability and feasibility in assessing the appropriateness of social
health insurance. It also addresses the likely impact on the economy, the health
sector and the various stakeholders, after introduction of the insurance scheme.
The paper reviews the experiences of other countries and draws lessons from
those experiences. The paper finds that most of the conditions for setting up a
social health insurance in Kenya are not yet in place and a lot needs to be done
to meet these conditions. In addition, there are likely to be both positive and
negative impacts on various stakeholders. The paper recommends that the
decision to introduce universal health insurance be premised on a careful and
thorough assessment of all the issues being raised, and implementation based
on clearly outlined stages.
In assessing the response of agricultural production to government policies, it is necessary to look not just at output prices
but at all the factors that affect real farm profits; to disentangle the effects on individual (or export) crops from the
effects on aggregate output; and to distinguish the short-run aggregate response from the long-run. Individual crops respond
strongly to price factors, but growth in one crop usually takes resources away from others. The price elasticity of agriculture
overall is very low in the short run because the main factors of production —land, capital, and labor —are fixed. Aggregate
output can grow only if more resources are devoted to agriculture or if technology changes. Output is also affected by investments
in roads, markets, irrigation, infrastructure, education, and health. Research and extension increase the demand for fertilizer.
As for adjustment policy: domestic food supply may not increase rapidly in response to adjustment programs, so structural
adjustment programs should do more than ease the balance of payments; analysis should focus on how to make all of agriculture
grow.
The objectives of this paper are to: (1) identify the pattern of private sector investment in the maize marketing system since the reforms were initiated and evaluate the extent of private sector response to the reforms; (2) assess how maize prices and marketing margins have changed in response to the market reforms; (3) identify market-oriented mechanisms that have evolved in the current environment to reduce vulnerability of farmers, traders and consumers to price and expenditure instability; and (4) identify strategies that the government and private sector could implement to effectively promote the development of the evolving market oriented food systems.
This paper is published by the Department of Agricultural Economics and the Department of Economics, Michigan State University (MSU). Funding for this research was provided by the Food Security II Cooperative Agreement (AEP-5459-A-00-2041-00) between Michigan State University and the United States Agency for International Development, through the Office of Agriculture and Food Security in the Economic Growth Center of the Global Bureau (G/EG/AFS). Supplemental funding for this research was also provided to the FS II Cooperative Agreement by the Africa Bureau, through the Food Security and Productivity Unit of the Sustainable Development Division, Productive Sector, Growth and Environment (AFR/SD/PSGE/FSP). Thomas Reardon is Associate Professor, Valerie Kelly is Visiting Assistant Professor, Eric Crawford is Professor, and Thomas Jayne is Visiting Associate Professor in the Department of Agricultural Economics, MSU. Daniel Clay is Professor in the Institute for International Agriculture, MSU. Kimseyinga Savadogo is Professor, FASEG, Universit de Ouagadougou, Burkina Faso. ii
In the 1960s and 1970s, the agricultural sectors of most African states descended into crisis. From the late 1960s, intellectual criticism of economic dirigisme mounted within the social sciences, sowing the ideational seeds of development strategy reversal. Scathing critiques of the disappointing history of state economic mismanagement in Africa (Bates, 1981; World Bank, 1981) then helped precipitate a striking reversal of African economic development strategy in the early 1980s.
Policy reforms and structural adjustment programs in Sahelian countries have eliminated many public agricultural support programs, creating a vacuum that has not yet been filled by the private sector. Sahelian farmers thus face more difficult access to inputs and higher input costs. Input use has stagnated or declined, yet higher population and less land for expansion of cultivation make it vital to increase the productivity of already cultivated land through adoption of intensive agricultural production techniques. While partial intensification is becoming common, too little investment is occurring in inputs and land improvements that maintain soil fertility, control erosion, and improve water availability. Partial intensification therefore risks being an unsustainable strategy. Higher and more sustainable productivity growth requires significantly increased use of chemical and organic fertilizer, improved seeds, bunds, and animal traction. The dilemma is how to ensure that such investments are financially and economically profitable and affordable in terms of government budgets. It is crucial to: (1) improve input access and reduce the unit cost of inputs to farmers through infrastructure investment; (2) increase the productivity of fertilizer and improved seed by encouraging complementary farm-level investments; (3) improve the coordination of input and output marketing systems, and improve incentives for private sector involvement; (4) improve farmers' ability to buy inputs using credit and non-farm income; (5) reduce the financial risks of purchased input use through integrated input/output markets and innovative credit schemes; and (6) evaluate the net economic benefits of selected agricultural support programs, including input subsidies.
This article surveys the empirical record of grain marketing and pricing policy in Eastern and Southern Africa over 1930–1995. The paper addresses five key issues with major implications for food policy throughout Africa: (a) why the anticipated supply response to market liberalization has not yet occurred; (b) why the common assumption of state taxation of farmers to support a cheap food policy does not apply in most of the countries in the region; (c) why the temporary successes of the state-led approach to stimulating smallholder grain production were unsustainable; (d) why the elimination of government food subsidies associated with market reform has not adversely affected consumers; and (e) why the fiscal cost of the marketing systems at least initially worsened rather than improved after the reforms were implemented in most countries. The key future challenges for marketing policy are how to develop coordinated and financially sustainable input, finance and commodity marketing systems for raising productivity growth in smallholder agriculture while overcoming inherited agricultural dualism, and how to mitigate the effects of food price instability in a cost-effective manner.
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Discussion Papers
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and fiscal policy dilemma. Njuguna S. Ndung'u, DP No. 1, 2000:
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A review of Kenya's current industrialization policy. Eric E. Ronge and Hezron O
A review of Kenya's current industrialization policy. Eric E. Ronge and
Hezron O. Nyangito. DP No. 3, 2000: ISBN 9966 949 02 X.
Beer taxation in Kenya: an assessment
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Beer taxation in Kenya: an assessment. Stephen N. Karingi, Mwangi S.
Specifying and estimating partial equilibrium models for use in macro models: a road map for the KIPPRA-Treasury Macro Model
Specifying and estimating partial equilibrium models for use in macro
models: a road map for the KIPPRA-Treasury Macro Model. Alemayehu
Geda and Njuguna S. Ndung'u. DP No. 8, 2001: ISBN 9966 949 16 X.
Determinants of poverty in Kenya: household-level analysis. Alemayehu
Geda, Niek de Jong, Germano Mwabu and Mwangi S. Kimenyi.
DP No. 9, 2001: ISBN 9966 949 17 8.
Kenya's exchange rate movement in a liberalized environment: an empirical analysis. Maureen Were
Kenya's exchange rate movement in a liberalized environment: an empirical
analysis. Maureen Were, Alemayehu Geda, Stephen N. Karingi and
Njuguna S. Ndungu. DP No. 10, 2001: ISBN 9966 949 24 0.
Special Reports Legal and other constraints on access to financial services in Kenya: survey results
- Alemayehu Geda
- S Njuguna
- Ndun
- Stephen N Gu
- Karingi
Theoretical base for the Kenya macro model: the KIPPRA-Treasury macro
model. Free Huizinga, Alemayehu Geda, Njuguna S. Ndun'gu and
Stephen N. Karingi. DP No. 11, 2001: ISBN 9966 949 25 9.
Special Reports
Legal and other constraints on access to financial services in Kenya: survey
results. Private Sector Development Division, KIPPRA, 2001: ISBN
Thinking about regulating? The better regulation guide. Private Sector Development Division
Thinking about regulating? The better regulation guide. Private Sector
Development Division, KIPPRA, 2002: ISBN 9966 949 20 8.
Policy framework of Kenya's tourism sector since independence and emerging policy concerns
Policy timeline and time series data for Kenya: an analytical data
compendium. KIPPRA 2002: ISBN: in Kenya: historical trends and current
challenges. Wilson S. K. Wasike. WP No. 1, 2001: ISBN 9966 949 11 9.
Policy framework of Kenya's tourism sector since independence and
emerging policy concerns. Moses M. Ikiara. WP No. 2, 2001: