Files
Abstract
Following the food price crisis of 2007-2008 many governments has responded with food reserve/stock programs. The role of those programs is to regulate price levels and reduce price volatility. These programs have been controversial for many decades because of the cost associated with their implementation and their effectiveness to regulate and stabilize prices. The present research uses the food reserve program implemented by the Benin government from 2008 to 2016 following the food prices crisis of 2007-2008 as a natural experiment to test the impact of such programs on prices levels and volatility. Using the model of competitive storage as theoretical background and the exponential generalized autoregressive conditional heteroskedastic (EGARCH) regression model as an estimation method, the study shows that the food reserve program has not been effective in regulating prices level and in stabilizing prices on rice market in Benin.