Revisiting the “Cotton Problem”—A Comparative Analysis of Cotton Reforms in Sub-Saharan Africa

The cotton sector has been among the most regulated in sub-Saharan Africa (SSA), and still largely is in West and Central Africa (WCA), despite repeated reform recommendations by international donors. On the other hand, orthodox reforms in East and Southern Africa (ESA) have not always yielded the expected results. This paper uses a stylized contracting model to investigate the link between market structure and equity and efficiency in SSA cotton sectors; explain the outcomes of reforms in ESA; and analyze the potential consequences of reforms in WCA. We illustrate our arguments with empirical observations on cotton sector performance.