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Abstract
Processing of meat and crops accounts for a large share of manufacturing in
Sub-Saharan Africa (SSA). The paper assesses empirically the impact of
hypothesized productivity change in agro-food processing on growth, trade,
employment, and input and output prices in SSA, using a 13 commodity, 7
region version of the Global Trade Analysis Project (GTAP) applied general
equilibrium model with a 1995 database. Results are compared to impacts of
factor-neutral and biased technical change in primary agricultural production--
grains, non-grain crops, and livestock--overall and with respect to the agrofood
sector itself. A given percentage increase in total factor productivity in
primary agricultural production is shown by every criterion to have much
greater favorable impacts than the same increase in any form of technical
change in processing, even when consideration is given only to the welfare of
people in the agro-food processing sector itself. Technological change in the
non-grain high value agricultural sectors such as horticulture and livestock are
second-best, but still powerful promoters of increased welfare. However, the
paper is not able to assess the costs or likelihood of securing different kinds
of technical change, and therefore comparisons are limited to the benefit side.