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The Effect of Information on Bargaining, Corruption and Trade Among Small Agriculture Traders in Kenya and Uganda

Agriculture Kenya

Credit: Sauti Africa

Credit: Sauti Africa

Governments within member states from the East African Community (EAC) and the Common Market for East and Southern Africa (COMESA) have invested significantly in programs to facilitate and formalize trade such as One-Stop-Border-Posts, Simplified Trade Regimes (STRs) and Quality standard certification. However, not much is known about the small-scale agriculture cross-border traders who cross the border multiple times per week to source products they can sell at a higher price on the other side of the border, especially when these traders contribute to informal cross-border trade not recorded in official trade statistics. Cross-border traders’ lack of updated information about border taxes and procedures may leave them susceptible to corruption at the hands of border agents, and little is known about these bargaining processes. The researchers introduce a free information service through Sauti Africa, which provides accurate tariff details to traders through an online platform, to understand how improved information affects trader behavior. The researchers will collect continuous data over time for 1000 traders on the Kenya-Uganda border, randomly selecting half to receive access to the Sauti platform. The randomized evaluation and this unique high-frequency dataset on trading behaviors will allow them to identify the impacts of the tariff information on bargaining, trade costs, small-scale agriculture traders’ choices of trade routes, and local prices. Results forthcoming.

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