Policy incentives for sustainable land use practices: Evidence from farmers’ choice behavior in dryland farming systems

Farming systems in many developing countries face persistent sustainability challenges, partly due to weak incentives for the adoption of ecologically sound practices. Existing policy instruments often reinforce this imbalance by favoring input-intensive approaches, such as chemical fertilizers, while neglecting sustainable soil management practices for which farmers often possess strong indigenous knowledge. Promoting sustainable agriculture in dryland farming systems therefore requires a better understanding of farmers’ preferences as well as the policy incentives that shape adoption decisions. This study examines how alternative policy incentives influence farmers’ choices regarding ecologically sustainable land management practices. Using a choice experiment with a between-subjects design, we elicited farmers’ trade-offs among different soil fertility and moisture-conserving practices under varying policy incentive schemes. For exploring preferences and estimating willingness to accept, we used mixed logit model. Results show negative preferences for chemical-based fertilization and positive preferences for moisture-conserving practices such as tie-ridges and trenches, which are well suited to dryland conditions. Preferences for zero tillage, although heterogeneous, are on average positive despite the widespread use of repeated tillage in current farming systems. Policy treatments reveal that cash transfers provide the strongest incentives for adopting sustainable practices, followed by input subsidies, whereas insurance mechanisms have weaker effects. These findings suggest that liquidity constraints constitute a major barrier to the uptake of sustainable land management. Policy interventions should thus prioritize flexible financial support instruments that allow farmers to allocate resources according to their specific production constraints, while complementing these with targeted incentives for practices that generate long-term environmental benefits. Adaptive policy designs that combine cash-based support, selective subsidies, and locally appropriate extension services are more likely to facilitate transitions toward sustainable agricultural systems.