Determinants of structural change in food exports from developing countries

Over the past three decades, there has been a rapid expansion of processed food exports, replacing traditional agriculture exports such as coffee and tea. However, this development and its policy implications have received little attention in the literature. This paper provides an overview of key characteristics and growth patterns of processed food exports in developing countries. The determinants of structural change towards processed food exports in developing countries are examined using panel data econometric analysis. The results suggest that trade policy openness, large domestic markets, good macroeconomic management-especially in terms of price stability-adequate financial support and infrastructure are the key factors influencing the shift towards processed food exports. Copyright © 2009 The Authors. Journal compilation © 2009 Crawford School of Economics and Government, The Australian National University and Blackwell Publishing Asia Pty Ltd..