Commodity markets are integral to the global economy. Understanding what drives developments of these markets is critical to the design of policy frameworks that facilitate the economic objectives of sustainable growth, inflation stability, poverty reduction, food security, and the mitigation of...

An econometric methodology for estimating both the equilibrium real exchange rate and the degree of exchange-rate misalignment.Estimating the degree of exchange-rate misalignment remains one of the most challenging empirical problems in an open economy. The basic problem is that the value of the...

We examine the drivers of monthly changes in maize prices across 18 Tanzanian markets. Local prices respond three to four times faster to the main regional market (Nairobi) than to the international benchmark (US Gulf). More importantly, shocks from Nairobi account for only one third of the...

This paper examines the degree to which world price signals have been transmitted into domestic prices for eight countries and ten commodities, a total of 31 country/commodity pairs. The main characteristic of these countries was that they all undertook substantial policy reforms during the...

When variables included in an OLS regression are stationary, conventional statistical measures such as t-statistics and R2's - in addition to a priori information from economic theory - are the standard indicators used to assess the performance of the hypothesized model. However, if the...