TY - JOUR
T1 - The joint effects of information and financing constraints on technology adoption
T2 - Evidence from a field experiment in rural Tanzania
AU - Harou, Aurélie P.
AU - Madajewicz, Malgosia
AU - Michelson, Hope
AU - Palm, Cheryl A.
AU - Amuri, Nyambilila
AU - Magomba, Christopher
AU - Semoka, Johnson M.
AU - Tschirhart, Kevin
AU - Weil, Ray
N1 - Funding Information:
This work was funded by USAID, United States of America ’s BASIS Assets & Market Access Collaborative Research; Columbia University’s Earth Clinic, United States of America ; and Columbia’s Cross-Cutting Initiatives, United States of America . We would like to thank participants at the 2014 and 2016 BASIS Technical Meetings, 2015 and 2017 Agricultural and Applied Economics Association Conference, 2017 Center for the Study of African Economies Conference, 2018 North East Universities Development Consortium, and 2018 University of Illinois at Urbana–Champaign Economics Seminar for helpful discussions and feedback. We would also like to thank Michael Carter and Travis Lybbert for helpful comments and suggestions. Alison Rose, Janelle Somerville, Lydiah Gatere, and Mary Pasquince each provided invaluable research assistance. We thank Gowthami Venkateswaran and Lila Cardell for their help producing Figure 1. All errors remain the authors’ alone. This study is registered in the AEA RCT Registry and the unique identifying number is: “AEARCTR-0005470”.
Funding Information:
This work was funded by USAID, United States of America's BASIS Assets & Market Access Collaborative Research; Columbia University's Earth Clinic, United States of America; and Columbia's Cross-Cutting Initiatives, United States of America. We would like to thank participants at the 2014 and 2016 BASIS Technical Meetings, 2015 and 2017 Agricultural and Applied Economics Association Conference, 2017 Center for the Study of African Economies Conference, 2018 North East Universities Development Consortium, and 2018 University of Illinois at Urbana–Champaign Economics Seminar for helpful discussions and feedback. We would also like to thank Michael Carter and Travis Lybbert for helpful comments and suggestions. Alison Rose, Janelle Somerville, Lydiah Gatere, and Mary Pasquince each provided invaluable research assistance. We thank Gowthami Venkateswaran and Lila Cardell for their help producing Figure 1. All errors remain the authors’ alone. This study is registered in the AEA RCT Registry and the unique identifying number is: “AEARCTR-0005470”.
Publisher Copyright:
© 2021 Elsevier B.V.
PY - 2022/3
Y1 - 2022/3
N2 - Low investment in profitable technologies contributes to persistent poverty. Many farmers in developing countries invest too little in fertilizer despite evidence that fertilizer is profitable. This field experiment investigates a two-part explanation: (1) farmers are reluctant to invest without farm-specific evidence of profitability, possibly because of heterogeneous returns, and (2) information is not sufficient to increase investment because of financing constraints. Farmers in one arm of the experiment receive fertilizer recommendations based on tests of their soils, others receive recommendations paired with an input subsidy, and others receive only the input subsidy. Only farmers who receive recommendations and the subsidy increase fertilizer application and yields relative to the control group. The financing constraint may explain limited response to heterogeneous fertilizer recommendations. The approximate net benefit of increased yields, accounting for the full cost of inputs and soil tests, is equivalent to average wages for seven days of work.
AB - Low investment in profitable technologies contributes to persistent poverty. Many farmers in developing countries invest too little in fertilizer despite evidence that fertilizer is profitable. This field experiment investigates a two-part explanation: (1) farmers are reluctant to invest without farm-specific evidence of profitability, possibly because of heterogeneous returns, and (2) information is not sufficient to increase investment because of financing constraints. Farmers in one arm of the experiment receive fertilizer recommendations based on tests of their soils, others receive recommendations paired with an input subsidy, and others receive only the input subsidy. Only farmers who receive recommendations and the subsidy increase fertilizer application and yields relative to the control group. The financing constraint may explain limited response to heterogeneous fertilizer recommendations. The approximate net benefit of increased yields, accounting for the full cost of inputs and soil tests, is equivalent to average wages for seven days of work.
KW - Agriculture
KW - Fertilizer
KW - Information
KW - Liquidity
KW - Soil quality
KW - Sub-Saharan Africa
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U2 - 10.1016/j.jdeveco.2021.102707
DO - 10.1016/j.jdeveco.2021.102707
M3 - Article
AN - SCOPUS:85119616971
SN - 0304-3878
VL - 155
JO - Journal of Development of Economics
JF - Journal of Development of Economics
M1 - 102707
ER -