IDEAS home Printed from https://ideas.repec.org/a/eee/jfpoli/v49y2014ip1p186-195.html
   My bibliography  Save this article

Informational cascades and technology adoption: Evidence from Greek and German organic growers

Author

Listed:
  • Chatzimichael, Konstantinos
  • Genius, Margarita
  • Tzouvelekas, Vangelis

Abstract

The present study aims to empirically analyze the effect of social interactions and conversion subsidies on the adoption rates of organic farming practices in two samples of olive and cereal growers in Greece and Germany, respectively. To this end we construct two alternative indicators to capture informational cascades created in rural areas. The first indicator is based on demographic characteristics while the other one on profitability considerations since farmers are likely to imitate the behavior of more successful farmers. Building upon the theoretical findings of Foster and Rosenweig (1995), Munshi (2004), Bandiera and Rasul (2006) and Weber (2012), we find that informational cascades are indeed important in revising farmers’ perceptions and adoption behavior in both rural areas of Europe. Our results show that conversion subsidies can enhance social network effects internalizing informational externalities even in areas where adoption rates are considerable. This finding is independent of the crop and the country under consideration underlying the importance of informational cascades for technology adoption.

Suggested Citation

  • Chatzimichael, Konstantinos & Genius, Margarita & Tzouvelekas, Vangelis, 2014. "Informational cascades and technology adoption: Evidence from Greek and German organic growers," Food Policy, Elsevier, vol. 49(P1), pages 186-195.
    • Handle: RePEc:eee:jfpoli:v:49:y:2014:i:p1:p:186-195
    DOI: 10.1016/j.foodpol.2014.08.001
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0306919214001274
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.foodpol.2014.08.001?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
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Justin Yifu Lin, 1991. "Education and Innovation Adoption in Agriculture: Evidence from Hybrid Rice in China," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 73(3), pages 713-723.
    2. Theodore W. Schultz, 1972. "The Increasing Economic Value of Human Time," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 54(5), pages 843-850.
    3. Jovanovic, Boyan & Nyarko, Yaw, 1996. "Learning by Doing and the Choice of Technology," Econometrica, Econometric Society, vol. 64(6), pages 1299-1310, November.
    4. Huffman, Wallace E & Mercier, Stephanie, 1991. "Joint Adoption of Microcomputer Technologies: An Analysis of Farmers' Decisions," The Review of Economics and Statistics, MIT Press, vol. 73(3), pages 541-546, August.
    5. Foster, Andrew D & Rosenzweig, Mark R, 1995. "Learning by Doing and Learning from Others: Human Capital and Technical Change in Agriculture," Journal of Political Economy, University of Chicago Press, vol. 103(6), pages 1176-1209, December.
    6. Oriana Bandiera & Imran Rasul, 2006. "Social Networks and Technology Adoption in Northern Mozambique," Economic Journal, Royal Economic Society, vol. 116(514), pages 869-902, October.
    7. Feder, Gershon & Just, Richard E & Zilberman, David, 1985. "Adoption of Agricultural Innovations in Developing Countries: A Survey," Economic Development and Cultural Change, University of Chicago Press, vol. 33(2), pages 255-298, January.
    8. Marianne Bertrand & Erzo F. P. Luttmer & Sendhil Mullainathan, 2000. "Network Effects and Welfare Cultures," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 115(3), pages 1019-1055.
    9. Lohr, Luanne & Salomonsson, Lennart, 2000. "Conversion subsidies for organic production: results from Sweden and lessons for the United States," Agricultural Economics, Blackwell, vol. 22(2), pages 133-146, March.
    10. Besley, Timothy & Case, Anne, 1993. "Modeling Technology Adoption in Developing Countries," American Economic Review, American Economic Association, vol. 83(2), pages 396-402, May.
    11. Dinar, Ariel & Yaron, Dan, 1990. "Influence Of Quality And Scarcity Of Inputs On The Adoption Of Modern Irrigation Technologies," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 15(2), pages 1-10, December.
    12. Stoneman, Paul L & David, Paul A, 1986. "Adoption Subsidies vs Information Provision as Instruments of Technology Policy," Economic Journal, Royal Economic Society, vol. 96(380a), pages 142-150, Supplemen.
    13. Munshi, Kaivan, 2004. "Social learning in a heterogeneous population: technology diffusion in the Indian Green Revolution," Journal of Development Economics, Elsevier, vol. 73(1), pages 185-213, February.
    14. Christine M. Moser & Christopher B. Barrett, 2006. "The complex dynamics of smallholder technology adoption: the case of SRI in Madagascar," Agricultural Economics, International Association of Agricultural Economists, vol. 35(3), pages 373-388, November.
    15. KS Pietola & AO Lansink, 2001. "Farmer response to policies promoting organic farming technologies in Finland," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 28(1), pages 1-15, March.
    16. Timothy G. Conley & Christopher R. Udry, 2010. "Learning about a New Technology: Pineapple in Ghana," American Economic Review, American Economic Association, vol. 100(1), pages 35-69, March.
    17. Wallace E. Huffman, 1977. "Allocative Efficiency: The Role of Human Capital," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 91(1), pages 59-79.
    18. Stigler, George J., 2011. "Economics of Information," Ekonomicheskaya Politika / Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 5, pages 35-49.
    19. Just, Richard E & Zilberman, David, 1983. "Stochastic Structure, Farm Size and Technology Adoption in Developing Agriculture," Oxford Economic Papers, Oxford University Press, vol. 35(2), pages 307-328, July.
    20. Sunding, David & Zilberman, David, 2001. "The agricultural innovation process: Research and technology adoption in a changing agricultural sector," Handbook of Agricultural Economics, in: B. L. Gardner & G. C. Rausser (ed.), Handbook of Agricultural Economics, edition 1, volume 1, chapter 4, pages 207-261, Elsevier.
    21. Goolsbee, Austan & Klenow, Peter J, 2002. "Evidence on Learning and Network Externalities in the Diffusion of Home Computers," Journal of Law and Economics, University of Chicago Press, vol. 45(2), pages 317-343, October.
    22. Richard Perrin & Don Winkelmann, 1976. "Impediments to Technical Progress on Small versus Large Farms," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 58(5), pages 888-894.
    23. Evenson, Robert E. & Westphal, Larry E., 1995. "Technological change and technology strategy," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 37, pages 2209-2299, Elsevier.
    24. Wozniak, Gregory D, 1993. "Joint Information Acquisition and New Technology Adoption: Late versus Early Adoption," The Review of Economics and Statistics, MIT Press, vol. 75(3), pages 438-445, August.
    25. Michael R. Rahm & Wallace E. Huffman, 1984. "The Adoption of Reduced Tillage: The Role of Human Capital and Other Variables," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 66(4), pages 405-413.
    26. Jean-Philippe Gervais & Rémy Lambert & François Boutin-Dufresne, 2001. "On the Demand for Information Services: An Application to Lowbush Blueberry Producers in Eastern Canada," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 49(2), pages 217-232, July.
    27. Kapur, Sandeep, 1995. "Technological Diffusion with Social Learning," Journal of Industrial Economics, Wiley Blackwell, vol. 43(2), pages 173-195, June.
    28. McFadden, Daniel L & Train, Kenneth E, 1996. "Consumers' Evaluation of New Products: Learning from Self and Others," Journal of Political Economy, University of Chicago Press, vol. 104(4), pages 683-703, August.
    29. Jeremy G. Weber, 2012. "Social learning and technology adoption: the case of coffee pruning in Peru," Agricultural Economics, International Association of Agricultural Economists, vol. 43, pages 73-84, November.
    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. Hai Hu & Andi Cao & Si Chen & Houjian Li, 2022. "Effects of Risk Perception of Pests and Diseases on Tea Famers’ Green Control Techniques Adoption," IJERPH, MDPI, vol. 19(14), pages 1-15, July.
    2. Mingyang Han & Ruifeng Liu & Hengyun Ma & Kaiyang Zhong & Jian Wang & Yifan Xu, 2022. "The Impact of Social Capital on Farmers’ Willingness to Adopt New Agricultural Technologies: Empirical Evidence from China," Agriculture, MDPI, vol. 12(9), pages 1-19, September.
    3. Parra-López, Carlos & Reina-Usuga, Liliana & Carmona-Torres, Carmen & Sayadi, Samir & Klerkx, Laurens, 2021. "Digital transformation of the agrifood system: Quantifying the conditioning factors to inform policy planning in the olive sector," Land Use Policy, Elsevier, vol. 108(C).
    4. Wen Xiang & Jianzhong Gao, 2023. "From Agricultural Green Production to Farmers’ Happiness: A Case Study of Kiwi Growers in China," IJERPH, MDPI, vol. 20(4), pages 1-25, February.
    5. Kexiao Xie & Yuerui Zhu & Yongqiang Ma & Youcheng Chen & Shuiji Chen & Zhidan Chen, 2022. "Willingness of Tea Farmers to Adopt Ecological Agriculture Techniques Based on the UTAUT Extended Model," IJERPH, MDPI, vol. 19(22), pages 1-14, November.
    6. Unay Gailhard, Ilkay & Bavorova, Miroslava & Pirscher, Frauke, 2012. "The Influence of Communication Frequency with Social Network Actors on the Continuous Innovation Adoption: Organic Farmers in Germany," 131st Seminar, September 18-19, 2012, Prague, Czech Republic 135786, European Association of Agricultural Economists.
    7. Wen Xiang & Jianzhong Gao, 2023. "Do Not Be Anticlimactic: Farmers’ Behavior in the Sustainable Application of Green Agricultural Technology—A Perceived Value and Government Support Perspective," Agriculture, MDPI, vol. 13(2), pages 1-24, January.
    8. Weihong Huang & Caiyan Yang & Ke Liu & Rui Min, 2023. "Information Acquisition Ability and Farmers’ Herd Behavior in Rice–Crayfish Coculture System Adoption," Agriculture, MDPI, vol. 13(10), pages 1-15, September.
    9. Dmytro Serebrennikov & Fiona Thorne & Zein Kallas & Sinéad N. McCarthy, 2020. "Factors Influencing Adoption of Sustainable Farming Practices in Europe: A Systemic Review of Empirical Literature," Sustainability, MDPI, vol. 12(22), pages 1-23, November.
    10. Mohamed Ghali & Maha Ben Jaballah & Nejla Ben Arfa & Annie Sigwalt, 2022. "Analysis of factors that influence adoption of agroecological practices in viticulture," Review of Agricultural, Food and Environmental Studies, Springer, vol. 103(3), pages 179-209, September.

    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. Margarita Genius & Christos Pantzios & Vangelis Tzouvelekas, 2003. "Information Acquisition and Adoption of Organic Farming Practices: Evidence from Farm Operations in Crete, Greece," Working Papers 0305, University of Crete, Department of Economics.
    2. Margarita Genius & Phoebe Koundouri & Celine Nauges & Vangelis TZOUVELEKAS, 2013. "Information Spillovers in Irrigation Technology Diffusion: Social Learning, Extension Visits and Spatial Effects," DEOS Working Papers 1319, Athens University of Economics and Business.
    3. Oriana Bandiera & Imran Rasul, 2006. "Social Networks and Technology Adoption in Northern Mozambique," Economic Journal, Royal Economic Society, vol. 116(514), pages 869-902, October.
    4. Anna Folke Larsen, 2015. "The network at work: Diffusion of banana cultivation in Tanzania," CAM Working Papers camwp2015_01, University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics.
    5. Feng, Yao, 2011. "Local spillovers and learning from neighbors: Evidence from durable adoptions in rural China," MPRA Paper 33924, University Library of Munich, Germany.
    6. B Kelsey Jack, "undated". "Market Inefficiencies and the Adoption of Agricultural Technologies in Developing Countries," CID Working Papers 50, Center for International Development at Harvard University.
    7. Tavneet Suri, 2006. "Selection and Comparative Advantage in Technology Adoption," Working Papers 944, Economic Growth Center, Yale University.
    8. Gin, Xavier & Yang, Dean, 2009. "Insurance, credit, and technology adoption: Field experimental evidencefrom Malawi," Journal of Development Economics, Elsevier, vol. 89(1), pages 1-11, May.
    9. Lim, Krisha & Wichmann, Bruno & Luckert, Martin, 2021. "Adaptation, spatial effects, and targeting: Evidence from Africa and Asia," World Development, Elsevier, vol. 139(C).
    10. Arslan, Cansın & Wollni, Meike & Oduol, Judith & Hughes, Karl, 2022. "Who communicates the information matters for technology adoption," World Development, Elsevier, vol. 158(C).
    11. Khushbu Mishra & Abdoul G. Sam & Gracious M. Diiro & Mario J. Miranda, 2020. "Gender and the dynamics of technology adoption: Empirical evidence from a household‐level panel data," Agricultural Economics, International Association of Agricultural Economists, vol. 51(6), pages 857-870, November.
    12. Wollni, Meike & Andersson, Camilla, 2014. "Spatial patterns of organic agriculture adoption: Evidence from Honduras," Ecological Economics, Elsevier, vol. 97(C), pages 120-128.
    13. Timothy G. Conley & Christopher R. Udry, 2010. "Learning about a New Technology: Pineapple in Ghana," American Economic Review, American Economic Association, vol. 100(1), pages 35-69, March.
    14. Jim Engle-Warnick & Javier Escobal & Sonia Laszlo, 2007. "Ambiguity Aversion as a Predictor of Technology Choice: Experimental Evidence from Peru," CIRANO Working Papers 2007s-01, CIRANO.
    15. Margarita Genius & Phoebe Koundouri & Céline Nauges & Vangelis Tzouvelekas, 2014. "Information Transmission in Irrigation Technology Adoption and Diffusion: Social Learning, Extension Services, and Spatial Effects," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 96(1), pages 328-344.
    16. Kondylis, Florence & Mueller, Valerie, 2012. "Seeing is Believing? Evidence from a Demonstration Plot Experiment in Mozambique:," MSSP working papers 1, International Food Policy Research Institute (IFPRI).
    17. Yoo, Do-il, 2012. "Individual and Social Learning in Bio-technology Adoption: The Case of GM Corn in the U.S," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124975, Agricultural and Applied Economics Association.
    18. Anna Folke Larsen, 2019. "When knowledgeable neighbors also share seedlings: diffusion of banana cultivation in Tanzania," Agricultural Economics, International Association of Agricultural Economists, vol. 50(1), pages 51-65, January.
    19. Dominik Naeher, 2022. "Technology Adoption Under Costly Information Processing," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 63(2), pages 699-753, May.

    More about this item

    Keywords

    Informational externalities; Organic farming adoption; Conversion subsidies; Germany; Greece;
    All these keywords.

    JEL classification:

    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q16 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - R&D; Agricultural Technology; Biofuels; Agricultural Extension Services
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities

    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:eee:jfpoli:v:49:y:2014:i:p1:p:186-195. 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/foodpol .

    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.