| dc.description.abstract | High price volatility in agricultural food markets has a greater impact not
only on smallholder farmers but also can affect the incomes and purchasing
power of a substantial proportion of the Tanzanian population and decrease
food security, especially to the lower middle class. This study applies the
ARCH-GARCH and the VAR/VECM models to examine the dynamics and
factors influencing price volatility in the domestic rice market. The results of
the price volatility analysis show that the volatility of rice prices tends to be
low and persistent over the long run. This is supported by the estimation results
of factors affecting price volatility, which showed that supply variables
play an important role in the short and long run in influencing rice price volatility.
The prices in the producing regions (large surplus areas) turned out to
be more volatile than the prices in the main consuming regions (large deficit
areas). This means that producers are exposed to a much higher price risk
than consumers. Thus, a favorable marketing environment for traders and
farmers, transparent trade policies, reliable market information, and organized
market infrastructure are essential to reduce food price volatility which
has a wider impact on economic growth. | en_US |
