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To what extent do fertiliser subsidies improve household income and reduce poverty? The case of Malawi

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  • Mkwara, Bentry

Abstract

In a number of sub-Saharan African countries, farm input subsidies are currently implemented in order to stimulate farm-level fertiliser application, enhance food security, improve household income and alleviate poverty. In this paper, a computable general equilibrium (CGE) model and the Foster, Greer and Thorbecke (FGT) method are employed to explore the extent to which fertiliser subsidies improve household income and reduce poverty in Malawi. Modelling results suggest that fertiliser subsidies lead to small increases in income distribution of all agricultural households. Rural non-agricultural households experience reductions in their incomes, while there are no income changes for metro households. The results of the FGT decomposition of poverty suggest that the subsidies help to reduce income poverty for rural and urban agricultural households, as well as for urban non-agricultural households. However, the poverty situation of rural non-agricultural households worsens, while no poverty changes occur in the case of metro households.

Suggested Citation

  • Mkwara, Bentry, 2013. "To what extent do fertiliser subsidies improve household income and reduce poverty? The case of Malawi," African Journal of Agricultural and Resource Economics, African Association of Agricultural Economists, vol. 8(4), pages 1-12, October.
    • Handle: RePEc:ags:afjare:163555
    DOI: 10.22004/ag.econ.163555
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    References listed on IDEAS

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    Cited by:

    1. Nicole M. Mason & Ayala Wineman & Solomon T. Tembo, 2020. "Reducing poverty by ‘ignoring the experts’? Evidence on input subsidies in Zambia," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 12(5), pages 1157-1172, October.
    2. Mwale, Martin Limbikani & Kamninga, Tony Mwenda, 2022. "Land rights and the impact of farm input subsidies on poverty convergence," MPRA Paper 112431, University Library of Munich, Germany.
    3. Van Asselt, Joanna & Grogan, Kelly A., 2020. "Do Fertilizer Subsidies Improve Soil Quality: Myopic vs. Dynamic Analysis of Smallholder Farmers in Ghana," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304546, Agricultural and Applied Economics Association.
    4. Houssou, Nazaire & Andam, Kwaw S. & Collins, Asante-Addo, 2017. "Can better targeting improve the effectiveness of Ghana's Fertilizer Subsidy Program? Lessons from Ghana and other countries in Africa south of the Sahara," IFPRI discussion papers 1605, International Food Policy Research Institute (IFPRI).

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