Revisiting the cotton problem: A comparative analysis of cotton reforms in sub-Saharan Africa

The cotton sector has been amongst the most regulated in Africa, and still is to a large extent in West and Central Africa (WCA), despite repeated refirm recommendations by international donors. On the other hand, orthodox refirms in East and Southern Africa (ESA) have not always yielded the expected results. This paper uses a stylised contracting model to investigate the link between market structure and equity and efficiency in sub-Saharan cotton sectors; explain the outcomes of refirms in ESA; and analyze the potential consequences of orthodox refirms in WCA. We argue that the level of the world price and of government intervention, the nature of pre-refirm institutional organisation, as well as the degree of parastatal inefficiency, all contribute to making refirms less attractive to firmers and governments in WCA today, as compared to ESA in the 1990s.We illustrate our arguments with empirical observations on the perfirmance of cotton sectors across sub-Saharan Africa.