caa a22 4500 397559402 CHVBK 20180308164812.0 cr unu---uuuuu 161202e199610 xx s 000 0 eng 10.1093/oxfordjournals.jae.a020915 doi (NATIONALLICENCE)oxford-10.1093/oxfordjournals.jae.a020915 Winter-Nelson Alex University of Illinois, Urbana-Champaign Marketing Natural Products and the Development of Synthetic Substitutes: a Kenyan Example [Elektronische Daten] [Alex Winter-Nelson] Adverse changes in terms of trade are generally viewed as an external cause of economic decline in Africa. However, in some instances export price shocks are not exogenous to domestic policy. When the entry of synthetic substitute producers is a function of the price of the natural product, raw material export levels can induce entry and cause shifts in demand. This paper examines the market for Kenyan pyrethrum (a natural insecticide) and develops a dynamic programming model for determining export strategy when the current export price induces structural changes in demand. Analysis of the pyrethrum market over the 1963-90 period suggests that the use of this analytical method could have mitigated the loss of market share to synthetics after 1980. The policy prescribed by the dynamic model would increase the exporter's net revenues by almost 30% compared with the policy indicated by analysis that treats demand as exogenous. In fact, the value of Kenyan pyrethrum exports from 1981-86 averaged 36% below the 1976-80 value. © Centre for the Study of African Economies Articles nationallicence Journal of African Economies Oxford University Press 5/3(1996-10), 469-496 0963-8024 5:3<469 1996 5 jafeco https://doi.org/10.1093/oxfordjournals.jae.a020915 text/html Onlinezugriff via DOI 1 research-article jats NATIONALLICENCE 856 40 https://doi.org/10.1093/oxfordjournals.jae.a020915 text/html Onlinezugriff via DOI NATIONALLICENCE 100 1- Winter-Nelson Alex University of Illinois, Urbana-Champaign NATIONALLICENCE 773 0- Journal of African Economies Oxford University Press 5/3(1996-10), 469-496 0963-8024 5:3<469 1996 5 jafeco Metadata rights reserved CC BY-NC-4.0 http://creativecommons.org/licenses/by-nc/4.0 nationallicence BK010053 XK010053 XK010000 NATIONALLICENCE NATIONALLICENCE NL-oxford