Market Imperfections and Farm Technology Adoption Decisions: A Case Study from the Highlands of Ethiopia
AbstractThis paper investigates the impacts of market and institutional imperfections on technology adoption in a model that considers fertilizer use and soil conservation to be joint decisions. Controlling for plot characteristics and other factors, we found that a household’s decision to adopt fertilizer significantly and negatively depends on whether the same household adopts soil conservation. The reverse causality, however, was insignificant. We also found that outcomes of market imperfections, such as limited access to credit, plot size, risk considerations, and rates-of-time preference, were significant factors in explaining variations in farm technology adoption decisions. Relieving the existing market imperfections will most likely increase the adoption rate of farm technologies
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Bibliographic InfoPaper provided by Resources For the Future in its series Discussion Papers with number dp-08-04-efd.
Date of creation: 07 Mar 2008
Date of revision:
Bivariate probit; fertilizer adoption; market imperfections; risk aversion; time preferences; soil conservation;
Other versions of this item:
- Yesuf, Mahmud & Köhlin, Gunnar, 2009. "Market Imperfections and Farm Technology Adoption Decisions - A Case Study from the Highlands of Ethiopia," Working Papers in Economics 403, University of Gothenburg, Department of Economics.
- C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
- Q24 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Land
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