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Factors explaining the low and variable profitability of fertilizer application to maize in Zambia

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  • William J. Burke
  • Thom. S. Jayne
  • J. Roy Black

Abstract

It is widely recognized that an “African green revolution†will require greater use of inorganic fertilizers. Often†made comparisons note that fertilizer use rates in Africa are just 10–20% of those in Asia, Europe and the Americas. Most attempts to explain relatively low†adoption of fertilizer assume yield responses to inorganic fertilization warrant higher application rates and hypothesize that observed use rates are limited by market†based factors. Another explanation may be that application rates are low because African yields are less responsive to inorganic fertilizer than yields in other regions, and less responsive than analysts perceive. Examining the case of Zambia, we evaluate whether yield response to fertilizers could explain adoption and application rates. A model of yield response is constructed and a combination of estimators is employed to mitigate potential biases related to correlation between fertilizer use and unobserved heterogeneity as well as stochastic shocks. Results indicate higher fertilization rates would be marginally profitable or unprofitable in many cases given commercial fertilizer and maize prices. Phosphoric fertilizer is particularly unprofitable on acidic soils, which are common in Zambia and other areas of sub†Saharan Africa. We propose feasible recommendations for diversifying the current government strategy to enhance crop productivity.

Suggested Citation

  • William J. Burke & Thom. S. Jayne & J. Roy Black, 2017. "Factors explaining the low and variable profitability of fertilizer application to maize in Zambia," Agricultural Economics, International Association of Agricultural Economists, vol. 48(1), pages 115-126, January.
  • Handle: RePEc:bla:agecon:v:48:y:2017:i:1:p:115-126
    DOI: 10.1111/agec.12299
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    File URL: https://doi.org/10.1111/agec.12299
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    11. Alain de Janvry & Elisabeth Sadoulet, 2019. "Transforming developing country agriculture: Removing adoption constraints and promoting inclusive value chain development," Working Papers hal-02287668, HAL.
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    13. Mason, N. & Morgan, S. & Levine, N.K. & Zulu-Mbata, O., 2018. "Dis-incentivizing sustainable intensification? The case of Zambia s fertilizer subsidy program," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277491, International Association of Agricultural Economists.
    14. Holden, Stein T., 2018. "The Economics of Fertilizer Subsidies," CLTS Working Papers 9/18, Norwegian University of Life Sciences, Centre for Land Tenure Studies, revised 16 Oct 2019.
    15. Oyinbo, Oyakhilomen & Chamberlin, Jordan & Vanlauwe, Bernard & Vranken, Liesbet & Kamara, Alpha & Craufurd, Peter & Maertens, Miet, 2018. "Farmers' preferences for site-specific extension services: Evidence from a choice experiment in Nigeria," Working Papers 276175, Katholieke Universiteit Leuven, Centre for Agricultural and Food Economics.
    16. Theriault, Veronique & Smale, Melinda & Haider, Hamza, 2017. "Maize Yield Response to Fertilizer under Differing Agro-Ecological Conditions in Burkina Faso," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258492, Agricultural and Applied Economics Association.

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