IDEAS home Printed from https://ideas.repec.org/a/bla/agecon/v53y2022i5p826-845.html
   My bibliography  Save this article

Adoption patterns and productivity impacts of agricultural mechanization services

Author

Listed:
  • Qinan Lu
  • Xiaodong Du
  • Huanguang Qiu

Abstract

Agricultural mechanization services (AMS) have emerged as a viable and effective solution for helping farmers gain access to machinery equipment in developing countries. This study investigates the simultaneous decision‐making regarding multiple mechanization services and the causal impacts of the AMS on land productivity among Chinese smallholders. We find that: (i) The ratio of off‐farm wage to AMS price, or the wage‐rent ratio, has a significant positive effect on AMS adoption; the sequential adoption of AMS starts with power‐intensive followed by control‐intensive production tasks, (ii) Switching to AMS in plowing, transplanting, and harvesting increases rice yield by 48.0 kg, 23.7 kg, and 7.9 kg, respectively, and (iii) The AMS of pesticide spraying significantly decreases yield but the negative effect can be mitigated with professional service providers and effective labor monitoring, highlighting potential moral hazards associated with AMS when monitoring is costly. Simulation illustrates that increased AMS adoption can significantly enhance food security in China.

Suggested Citation

  • Qinan Lu & Xiaodong Du & Huanguang Qiu, 2022. "Adoption patterns and productivity impacts of agricultural mechanization services," Agricultural Economics, International Association of Agricultural Economists, vol. 53(5), pages 826-845, September.
    • Handle: RePEc:bla:agecon:v:53:y:2022:i:5:p:826-845
    DOI: 10.1111/agec.12737
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/agec.12737
    Download Restriction: no
    File URL: https://libkey.io/10.1111/agec.12737?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Ghatak, Maitreesh & Pandey, Priyanka, 2000. "Contract choice in agriculture with joint moral hazard in effort and risk," Journal of Development Economics, Elsevier, vol. 63(2), pages 303-326, December.
    2. Kala, Namrata & Caunedo, Julieta, 2021. "Mechanizing Agriculture," CEPR Discussion Papers 16369, C.E.P.R. Discussion Papers.
    3. Li, Chuhui & Poskitt, D.S. & Zhao, Xueyan, 2019. "The bivariate probit model, maximum likelihood estimation, pseudo true parameters and partial identification," Journal of Econometrics, Elsevier, vol. 209(1), pages 94-113.
    4. Catherine J. Morrison Paul & Mahmut Yasar, 2009. "Outsourcing, productivity, and input composition at the plant level," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 42(2), pages 422-439, May.
    5. Jin, Songqing & Deininger, Klaus, 2009. "Land rental markets in the process of rural structural transformation: Productivity and equity impacts from China," Journal of Comparative Economics, Elsevier, vol. 37(4), pages 629-646, December.
    6. Dubois, Pierre, 2002. "Moral hazard, land fertility and sharecropping in a rural area of the Philippines," Journal of Development Economics, Elsevier, vol. 68(1), pages 35-64, June.
    7. Clements,Kenneth W. & Zhao,Xueyan, 2014. "Economics and Marijuana," Cambridge Books, Cambridge University Press, number 9781107421479, September.
    8. Amin W. Mugera & Michael R. Langemeier & Andrew Ojede, 2016. "Contributions of Productivity and Relative Price Changes to Farm-level Profitability Change," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 98(4), pages 1210-1229.
    9. Margarida Duarte & Diego Restuccia, 2010. "The Role of the Structural Transformation in Aggregate Productivity," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(1), pages 129-173.
    10. Nazaire Houssou & Xinshen Diao & Frances Cossar & Shashidhara Kolavalli & Kipo Jimah & Patrick Ohene Aboagye, 2013. "Agricultural Mechanization in Ghana: Is Specialized Agricultural Mechanization Service Provision a Viable Business Model?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 95(5), pages 1237-1244.
    11. Cortes, Guido Matias & Salvatori, Andrea, 2019. "Delving into the demand side: Changes in workplace specialization and job polarization," Labour Economics, Elsevier, vol. 57(C), pages 164-176.
    12. Ruttan, Vernon W., 1987. "Induced innovation and agricultural development," Food Policy, Elsevier, vol. 12(3), pages 196-216, August.
    13. Diao, Xinshen & Silver, Jed & Takeshima, Hiroyuki, 2016. "Agricultural mechanization and agricultural transformation:," IFPRI discussion papers 1527, International Food Policy Research Institute (IFPRI).
    14. Jikun Huang & Jiping Ding, 2016. "Institutional innovation and policy support to facilitate small-scale farming transformation in China," Agricultural Economics, International Association of Agricultural Economists, vol. 47(S1), pages 227-237, November.
    15. Koen Bel & Dennis Fok & Richard Paap, 2018. "Parameter estimation in multivariate logit models with many binary choices," Econometric Reviews, Taylor & Francis Journals, vol. 37(5), pages 534-550, May.
    16. JunJie Wu & Bruce A. Babcock, 1998. "The Choice of Tillage, Rotation, and Soil Testing Practices: Economic and Environmental Implications," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(3), pages 494-511.
    17. Zhang, Xiaobo & Yang, Jin & Reardon, Thomas, 2020. "Mechanization outsourcing clusters and division of labor in Chinese agriculture," IFPRI book chapters, in: An evolving paradigm of agricultural mechanization development: How much can Africa learn from Asia?, chapter 2, pages 71-96, International Food Policy Research Institute (IFPRI).
    18. Eoin McGuirk & Marshall Burke, 2020. "The Economic Origins of Conflict in Africa," Journal of Political Economy, University of Chicago Press, vol. 128(10), pages 3940-3997.
    19. Chen, Shuo & Lan, Xiaohuan, 2020. "Tractor vs. animal: Rural reforms and technology adoption in China," Journal of Development Economics, Elsevier, vol. 147(C).
    20. repec:hoo:wpaper:e-92-3 is not listed on IDEAS
    21. Christophe Bontemps & Céline Nauges, 2016. "The Impact of Perceptions in Averting-decision Models: An Application of the Special Regressor Method to Drinking Water Choices," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 98(1), pages 297-313.
    22. Thomas Daum & Regina Birner, 2017. "The neglected governance challenges of agricultural mechanisation in Africa – insights from Ghana," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 9(5), pages 959-979, October.
    23. Diao, Xinshen & Cossar, Frances & Houssou, Nazaire & Kolavalli, Shashidhara, 2014. "Mechanization in Ghana: Emerging demand, and the search for alternative supply models," Food Policy, Elsevier, vol. 48(C), pages 168-181.
    24. Preety Ramful & Xueyan Zhao, 2009. "Participation in marijuana, cocaine and heroin consumption in Australia: a multivariate probit approach," Applied Economics, Taylor & Francis Journals, vol. 41(4), pages 481-496.
    25. Aziz Atamanov & Marrit Van den Berg, 2012. "Participation and returns in rural nonfarm activities: evidence from the Kyrgyz Republic," Agricultural Economics, International Association of Agricultural Economists, vol. 43(4), pages 459-471, July.
    26. Lili Jia & Martin Petrick, 2014. "How does land fragmentation affect off-farm labor supply: panel data evidence from China," Agricultural Economics, International Association of Agricultural Economists, vol. 45(3), pages 369-380, May.
    27. Matsuyama, Kiminori, 1992. "Agricultural productivity, comparative advantage, and economic growth," Journal of Economic Theory, Elsevier, vol. 58(2), pages 317-334, December.
    28. Emiliano Magrini & Jean Balié & Cristian Morales-Opazo, 2017. "Cereal price shocks and volatility in sub-Saharan Africa: what really matters for farmers’ welfare?," Agricultural Economics, International Association of Agricultural Economists, vol. 48(6), pages 719-729, November.
    29. Michael R. Carter & Yang Yao, 2002. "Local versus Global Separability in Agricultural Household Models: The Factor Price Equalization Effect of Land Transfer Rights," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(3), pages 702-715.
    30. Sheahan, Megan & Barrett, Christopher B., 2017. "Ten striking facts about agricultural input use in Sub-Saharan Africa," Food Policy, Elsevier, vol. 67(C), pages 12-25.
    31. Wanglin Ma & Awudu Abdulai & Renan Goetz, 2018. "Agricultural Cooperatives and Investment in Organic Soil Amendments and Chemical Fertilizer in China," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 100(2), pages 502-520.
    32. Christian At & Lionel Thomas, 2019. "Optimal Tenurial Contracts Under Both Moral Hazard and Adverse Selection," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 101(3), pages 941-959.
    33. Amalavoyal Chari & Elaine M Liu & Shing-Yi Wang & Yongxiang Wang, 2021. "Property Rights, Land Misallocation, and Agricultural Efficiency in China [Misallocation, Selection and Productivity: A Quantitative Analysis with Panel Data from China]," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 88(4), pages 1831-1862.
    34. Charles A. Holt & Susan K. Laury, 2002. "Risk Aversion and Incentive Effects," American Economic Review, American Economic Association, vol. 92(5), pages 1644-1655, December.
    35. H. Holly Wang & Yanbing Wang & Michael S. Delgado, 2014. "The Transition to Modern Agriculture: Contract Farming in Developing Economies," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 96(5), pages 1257-1271.
    36. Pingali, Prabhu, 2007. "Agricultural Mechanization: Adoption Patterns and Economic Impact," Handbook of Agricultural Economics, in: Robert Evenson & Prabhu Pingali (ed.), Handbook of Agricultural Economics, edition 1, volume 3, chapter 54, pages 2779-2805, Elsevier.
    37. Daniel Chrisendo & Hermanto Siregar & Matin Qaim, 2021. "Oil palm and structural transformation of agriculture in Indonesia," Agricultural Economics, International Association of Agricultural Economists, vol. 52(5), pages 849-862, September.
    38. Adu-Baffour, Ferdinand & Daum, Thomas & Birner, Regina, 2019. "Can small farms benefit from big companies’ initiatives to promote mechanization in Africa? A case study from Zambia," Food Policy, Elsevier, vol. 84(C), pages 133-145.
    39. Hausman, Jerry A, 1975. "An Instrumental Variable Approach to Full Information Estimators for Linear and Certain Nonlinear Econometric Models," Econometrica, Econometric Society, vol. 43(4), pages 727-738, July.
    40. Robert Evenson & Prabhu Pingali (ed.), 2007. "Handbook of Agricultural Economics," Handbook of Agricultural Economics, Elsevier, edition 1, volume 3, number 1.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Shen Hongbing & Wang Zhe, 2024. "Coupled and Coordinated Development of Economic Growth and Green Sustainability in a Manufacturing Enterprise under the Context of Dual Carbon Goals: Carbon Peaking and Carbon Neutrality," Economics - The Open-Access, Open-Assessment Journal, De Gruyter, vol. 18(1), pages 1-11.
    2. Meng Meng & Leng Yu & Xiaohua Yu, 2024. "Machinery structure, machinery subsidies, and agricultural productivity: Evidence from China," Agricultural Economics, International Association of Agricultural Economists, vol. 55(2), pages 223-246, March.
    3. Xiaocheng Wang & Chenxi Yang & Cuixia Qiao, 2024. "Agricultural Service Trade and Green Development: A Perspective Based on China’s Agricultural Total Factor Productivity," Sustainability, MDPI, vol. 16(18), pages 1-23, September.
    4. Xue Shen & Quanyu Yang & Ting Qiu & Rongjun Ao, 2023. "Off-Farm Employment, Outsourced Machinery Services, and Farmers’ Ratoon Rice Production Behavior: Evidence from Rice Farmers in Central China," Agriculture, MDPI, vol. 13(10), pages 1-19, September.
    5. Xuelan Li & Rui Guan, 2023. "How Does Agricultural Mechanization Service Affect Agricultural Green Transformation in China?," IJERPH, MDPI, vol. 20(2), pages 1-23, January.
    6. Yawen Liang & Yue Wang & Yao Sun & Junhu Ruan, 2024. "Study on the Influence of Agricultural Scale Management Mode on Production Efficiency Based on Meta-Analysis," Land, MDPI, vol. 13(7), pages 1-20, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Belton, Ben & Win, Myat Thida & Zhang, Xiaobo & Filipski, Mateusz, 2021. "The rapid rise of agricultural mechanization in Myanmar," Food Policy, Elsevier, vol. 101(C).
    2. Lu, Qinan & Du, Xiaodong, 2020. "The Outsourcing Choice of Agricultural Production Tasks: Implications for Food Security - A Multiple-task Based Approach," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304333, Agricultural and Applied Economics Association.
    3. Adu-Baffour, Ferdinand & Daum, Thomas & Birner, Regina, 2019. "Can small farms benefit from big companies’ initiatives to promote mechanization in Africa? A case study from Zambia," Food Policy, Elsevier, vol. 84(C), pages 133-145.
    4. Aryal, Jeetendra Prakash & Rahut, Dil Bahadur & Thapa, Ganesh & Simtowe, Franklin, 2021. "Mechanisation of small-scale farms in South Asia: Empirical evidence derived from farm households survey," Technology in Society, Elsevier, vol. 65(C).
    5. Zhou, Xiaoshi & Ma, Wanglin, 2021. "Effects of Agricultural Mechanization on Land Productivity: Evidence from China," 2021 Conference, August 17-31, 2021, Virtual 315143, International Association of Agricultural Economists.
    6. Takeshima, Hiroyuki & Houssou, Nazaire & Diao, Xinshen, 2018. "Effects of tractor ownership on returns-to-scale in agriculture: Evidence from maize in Ghana," Food Policy, Elsevier, vol. 77(C), pages 33-49.
    7. Adu-Baffour, Ferdinand & Daum, Thomas & Birner, Regina, 2018. "Can Big Companies’ Initiatives to Promote Mechanization Benefit Small Farms in Africa? A Case Study from Zambia," Discussion Papers 273521, University of Bonn, Center for Development Research (ZEF).
    8. Frances Warren, 2023. "Population density, urbanisation and agricultural mechanisation in modern Ghana," Review of Development Economics, Wiley Blackwell, vol. 27(3), pages 1605-1629, August.
    9. Xiang Li & Xiaoqin Guo, 2023. "Can Policy Promote Agricultural Service Outsourcing? Quasi-Natural Experimental Evidence from China," Sustainability, MDPI, vol. 15(2), pages 1-18, January.
    10. Jian Zhang & Ashok K. Mishra & Peixin Zhu, 2021. "Land rental markets and labor productivity: Evidence from rural China," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 69(1), pages 93-115, March.
    11. Idelphonse O. Saliou & Afio Zannou & Augustin K. N. Aoudji & Albert N. Honlonkou, 2020. "Drivers of Mechanization in Cotton Production in Benin, West Africa," Agriculture, MDPI, vol. 10(11), pages 1-13, November.
    12. Xin Deng & Zhongcheng Yan & Dingde Xu & Yanbin Qi, 2020. "Land Registration, Adjustment Experience, and Agricultural Machinery Adoption: Empirical Analysis from Rural China," Land, MDPI, vol. 9(3), pages 1-14, March.
    13. Zhang, Jian & Mishra, Ashok K. & Zhu, Peixin, 2023. "Land Markets and Labor Productivity: Empirical Evidence from China," IZA Discussion Papers 16575, Institute of Labor Economics (IZA).
    14. Aihounton, Ghislain & Christiaensen, Luc, 2024. "Does agricultural intensification pay in the context of structural transformation?," Food Policy, Elsevier, vol. 122(C).
    15. Wang, Xiaobing & Yamauchi, Futoshi & Huang, Jikun & Rozelle, Scott, 2020. "What constrains mechanization in Chinese agriculture? Role of farm size and fragmentation," China Economic Review, Elsevier, vol. 62(C).
    16. Thomas Daum & Regina Birner, 2017. "The neglected governance challenges of agricultural mechanisation in Africa – insights from Ghana," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 9(5), pages 959-979, October.
    17. Daum, Thomas & Villalba, Roberto & Anidi, Oluwakayode & Mayienga, Sharon Masakhwe & Gupta, Saurabh & Birner, Regina, 2021. "Uber for tractors? Opportunities and challenges of digital tools for tractor hire in India and Nigeria," World Development, Elsevier, vol. 144(C).
    18. Bekele Hundie Kotu & Julius Manda & Christopher Mutungi & Gundula Fischer & Audifas Gaspar, 2023. "Farmers' willingness to invest in mechanized maize shelling and potential financial benefits: Evidence from Tanzania," Agribusiness, John Wiley & Sons, Ltd., vol. 39(3), pages 854-874, July.
    19. Baomin Cui & Lingling Tang & Jianxu Liu & Songsak Sriboonchitta, 2023. "How Does Land Transfer Impact the Household Labor Productivity in China? Empirical Evidence from Survey Data in Shandong," Land, MDPI, vol. 12(4), pages 1-24, April.
    20. Houssou, Nazaire & Chapoto, Antony, 2014. "The changing landscape of agriculture in Ghana: Drivers of farm mechanization and its impacts on cropland expansion and intensification:," IFPRI discussion papers 1392, International Food Policy Research Institute (IFPRI).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:agecon:v:53:y:2022:i:5:p:826-845. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/iaaeeea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.