The Price of Liberalization: Smallholder Coffee Producers in the Era of Globalization

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Coffee-producing countries in sub-Saharan Africa have been trading coffee for centuries, but exports outside the continent expanded in the postcolonial period. Internationalization of coffee-producing countries expanded further in the 1980s and 1990s, when governments adopted market reforms and trade liberalization. Liberalization of an economy is, ipso facto, the implementation of policies to create an open, free trade, market economy. As the IMF noted in 1992, a marked shift in the orientation of the trade and industrial policies of most developing countries away from a heavy reliance on direct intervention and inward-looking industrial policies toward less controlled and more export-oriented trade regimes occurred from the mid-1980s onward. Similarly, liberal economic theory suggests that pressures caused by the internationalization of an economy widely affect preferences, institutions, and policies. Liberal economic theory is the only one of these theories that does not put the onus on leadership or institutional choice.