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Abstract
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Article Information:
Market Structure and Competition in the Ghanaian Cocoa Sector after Partial Liberalization
Benjamin Tetteh Anang
Corresponding Author: Benjamin Tetteh Anang
Submitted: 2011 August, 19
Accepted: 2011 September, 18
Published: 2011 November, 20 |
Abstract:
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The study looked at market structure and competition in Ghana cocoa sector after the introduction
of partial reforms in cocoa marketing. The study involved 80 randomly selected cocoa farmers from four
communities in Bibiani-Anhwiaso-Bekwai District, Western Region, Ghana. Secondary data were collected
from the Head Office of Ghana Cocoa Board, Accra. Results showed that more firms have entered the industry
since the introduction of competition resulting in an increase in industry competition and a loss of market share
of the top buyers. The cocoa sector experienced a gradual decrease in market concentration. The concentration
ratios revealed that a few large firms continue to dominate the market. However, there are no monopolistic
tendencies in the Ghanaian cocoa sector and firms are free to compete with each other for market shares. The
absence of price competition has resulted in an interesting marketing scenario with producer-buyer loyalty
playing a key role in gaining market share. Licensed Buying Companies have found ways to ensure that farmers
sell to them alone and these include prompt payments, social involvement in farmers communities, and
provision of services, incentives, subsidized inputs and credit. Farmers in turn maintain loyalty to buyers who
provide certain incentives and cash rewards. More benefits accrue to farmers now than the period before the
reforms. It was concluded that the market structure in Ghana cocoa sector will remain unchanged for some time
if the government of Ghana maintains its partial liberalization policy.
Key words: Cocoa, competition, Ghana, liberalization, licensed buying companies, market structure,
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Cite this Reference:
Benjamin Tetteh Anang, . Market Structure and Competition in the Ghanaian Cocoa Sector after Partial Liberalization. Current Research Journal of Social Sciences, (6): 465-470.
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ISSN (Online): 2041-3246
ISSN (Print): 2041-3238 |
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