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The Impact of Access to Credit on the Adoption of hybrid maize in Malawi: An Empirical test of an Agricultural Household Model under credit market failure

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Author Info
Simtowe, F.
Zeller, M.

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Abstract

Guided by the frame work of a household model under credit market failure, this paper aims at investigating the impact of access to credit on the adoption of hybrid maize among households that vary in their credit constraints. The data used in the study is from Malawi collected by the International Food Policy Research Institute (IFPRI).Using the direct elicitation approach; households are classified into constrained and unconstrained regimes. The impact of access to credit is estimated using a switching regression in a Double-Hurdle model. Results reveal that while access to credit increases adoption among credit constrained households, it has no effect among unconstrained households. Results also show that factors that affect adoption among credit constrained households are different from those that that affect adoption among unconstrained household

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Paper provided by African Association of Agricultural Economists (AAAE) in its series 2007 Second International Conference, August 20-22, 2007, Accra, Ghana with number 52076.

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Date of creation: Nov 2008
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Handle: RePEc:ags:aaae07:52076

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Related research
Keywords: credit constraints; double-hurdle; hybrid maize; adoption; Malawi; Agricultural and Food Policy; Agricultural Finance; Demand and Price Analysis; Environmental Economics and Policy; Farm Management; Food Consumption/Nutrition/Food Safety; Food Security and Poverty; International Relations/Trade; Labor and Human Capital; Marketing; Productivity Analysis; Research and Development/Tech Change/Emerging Technologies; Resource /Energy Economics and Policy;

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  1. Simtowe, Franklin, 2006. "Can Risk-aversion towards fertilizer explain part of the non-adoption puzzle for hybrid maize? Empirical evidence from Malawi," MPRA Paper 1241, University Library of Munich, Germany, revised 20 Dec 2006. [Downloadable!]
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  1. Gine, Xavier & Yang, Dean, 2007. "Insurance, credit, and technology adoption : field experimental evidence from Malawi," Policy Research Working Paper Series 4425, The World Bank. [Downloadable!]
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