This paper outlines the role of improved soil fertility in the process of structural transformation, and examines specific financial, economic, social, and political arguments in favor of promoting increased fertilizer use, particularly in smallholder farming systems. The paper draws experiences and insights from the literature on which policies and programs appear to work best and which least well in stimulating a sustainable increase in fertilizer use by small farmers. Special attention is given to addressing the question of fertilizer subsidies: Under what circumstances are they warranted and what form should they take, if and when they are implemented?
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