Market information systems (MIS) are designed to improve market transparency, by disseminating to producers, traders, and consumers, information supposed to help both with their decisions about marketing production or investment. They are expected to generate improvements in:

i) efficiency , with more competitive trade and lower transaction costs leading to better resource allocation (reduction of the differential of price between the producer and the consumer, better spatial integration of the markets etc.), and;

ii) equity , with reduced information asymmetries with middlemen and other buyers leading to better prices for the producers.

Historically, the first Market information systems (MIS) were introduced in the 1920s in the United States in order to fight against market concentration in agro-industry (Bowbrick 1988). They were public tools collecting and disseminating information mainly on prices. During the 30s’MIS were introduced into other Western countries, and in the 80s into the transition and developing countries, for many types of products including cereals and tubers, fruits and vegetables, cattle etc.. They were strongly promoted by the donors and the international organizations, in particular FAO, as tools to support the liberalization of the agricultural markets (Poon, 2002, Shepherd, 2001). They multiplied so much in Africa, Asia and Latin America that FAO decided to draw up an inventory (Shepherd, 1997). All these first generation MIS had a similar configuration: i) each was centered on a country and a group of products (cereals, cattle etc); ii) information was almost exclusively about prices; iii) it was collected at a sample of markets covering the whole of the country before being centralized, selected, and then disseminated for free on a national scale, through radio or other media, and; v) the MIS were managed in a centralized way by government departments or projects, and mainly aid-financed.

Evaluations raised many methodological problems (Galtier and Egg 2003). Some of them involved surveying market players (producers, traders, and consumers) about their sources and needs of information. Generally speaking, these studies showed a weak role of the MIS, though it is possible that they under-estimated the benefits. They could only estimate the percentage of players informed directly  by the MIS, and not those who were indirectly informed by others (parents, close relations, other producers or traders), who had themselves been informed by the MIS. Other evaluations were based on the analysis of price time series. These generally showed an increase in the spatial integration of the markets, but without being able to exclusively attribute it to the impact of the MIS.  Indeed, since the implementation of the MIS in the 80s’, the environment of the markets has changed a lot (liberalization, investment in infrastructure, development of mobile telephony which traders often use intensively). In spite of the limitations and inconclusiveness of these evaluations, the general feeling which emerges is that the MIS did not meet the expectations they generated.

Along with the new information and communication technologies (in particular Internet and mobile phones), this undoubtedly explains the emergence of a second generation of MIS at the end of the 90s’. The new MIS are characterized by their decentralized, interactive and sometimes private aspects.  Sometimes, they try to link up with other market institutions such as Warehouses Receipt Systems (WRS), commodity exchanges or multi-stakeholder round tables.

These second generation MIS are still badly known. The only major comparative study carried out on MIS (Shepherd 1997) took place prior to their existence, and with exception of one by Tollens (2006), there have been almost no impact studies. Nevertheless, the little information we have on them is enough to see their extreme diversity. Whereas the first generation MIS were all similar regardless of product and country), the new MIS innovate in very diverse ways.

If all of them use new information and communication technologies (NICT), they make different uses of them. Many use the internet and mobile telephony to improve reliability and the speed with which information is collected, processed and disseminated. But these technologies also make it possible to generate interactivity with users. Indeed, when dissemination is by Internet or SMS, the players can choose information among a list of available data.  According to their choices, they reveal  their demand for information to MIS administrators.

Second generation MIS also differentiate themselves in terms of products covered and scale. As it became apparent that players’ decisions involved trading-off between different products (e. g. whether to sell cereals or onions), this often led new MIS to widen the product coverage. At the same time, the national MIS were given a super-national dimension (e. g. by linking them with the West African RESIMAO and by decentralizing them (e. g. by disseminating information in Mali according to the needs of different localities).

Some MIS are no longer based within Ministries but within ‘inter-professions’ (confederations of differing trade associations representing farmers, traders, millers etc.), Chambers of Commerce and Chambers of Agriculture.  Others (such as Manobi in Senegal) are completely private, and sell information to market players. Some depend on entities set up by market players and State representatives (like the Rice ‘Observatory’ in Madagascar). Others (like KACE in Kenya) have been established by entities whose prime purpose is to establish trading floors.

The information disseminated is also very diverse: of course current prices remain an important variable but some MIS also try to disseminate information re availability of varieties or qualities, the turnover of marketplaces, quantities traded, stocks, market trends, price forecasts, bids and offers, and so on.

While most primary information is collected by collectors present in the markets, some MIS are fed by traders’ declarations required by law (notably the cattle and the meat trade MIS established in the United States in 1999), or by supply and demand recorded by users (as in Tradenet MIS).

Lastly, some MIS specify rules of non-diffusion of information when the active market players are very few, in order to prevent average price outputs revealing private information.