Targeted Subsidies and Private Market Participation: An Assessment of Fertilizer Demand in Nigeria:
Though input vouchers are being publicized as a mechanism to simultaneously target subsidies and develop demand in private markets, limited empirical evidence of their effect on private input demand exists. Few empirical studies, if any, exist on the effect of targeted subsidies on private input demand in Nigeria or West Africa . Consequently this study begins to fill this gap by estimating the effect of a targeted input subsidy on farmer participation in the private fertilizer market in Nigeria. Using a double hurdle model and a control function approach, this study explores the effect of increasing access to subsidized fertilizer on farmer participation in the private fertilizer market in Kano, Nigeria. The study finds evidence that farmers who received subsidized fertilizer in 2009 tended to have less assets than their counterparts who did not. Within this context, although receiving subsidized fertilizer did not appear to increase the probability of participating in the private fertilizer market, it did increase the quantity of fertilizer purchased from the private market once the decision to participate had been made. It appears that one benefit of the voucher program was that it developed links between rural farmers and input suppliers. Furthermore, where private fertilizer markets are weak, results indicate that there could be significant gains from the temporary use of voucher programs to create links between input suppliers and farmers.
|Date of creation:||2012|
|Date of revision:|
|Contact details of provider:|| Postal: 2033 K Street, NW, Washington, DC 20006|
Web page: http://www.ifpri.org/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Alex Winter-Nelson & Anna Temu, 2005. "Impacts of prices and transactions costs on input usage in a liberalizing economy: evidence from Tanzanian coffee growers," Agricultural Economics, International Association of Agricultural Economists, vol. 33(3), pages 243-253, November.
- Minot, Nicholas & Benson, Todd, 2009. "Fertilizer subsidies in Africa: Are vouchers the answer?," Issue briefs 60, International Food Policy Research Institute (IFPRI).
- Rivers, Douglas & Vuong, Quang H., 1988. "Limited information estimators and exogeneity tests for simultaneous probit models," Journal of Econometrics, Elsevier, vol. 39(3), pages 347-366, November.
- Liverpool-Tasie, Saweda L.O. & Banful, Afua Branoah & Olaniyan, Babatunde, 2010. "Assessment of the 2009 fertilizer voucher program in Kano and Taraba, Nigeria:," NSSP working papers 17, International Food Policy Research Institute (IFPRI).
- de Janvry, Alain & Fafchamps, Marcel & Sadoulet, Elisabeth, 1991. "Peasant Household Behaviour with Missing Markets: Some Paradoxes Explained," Economic Journal, Royal Economic Society, vol. 101(409), pages 1400-417, November.
- Garen, John, 1984. "The Returns to Schooling: A Selectivity Bias Approach with a Continuous Choice Variable," Econometrica, Econometric Society, vol. 52(5), pages 1199-1218, September.
- Banful, Afua Branoah, 2011. "Old Problems in the New Solutions? Politically Motivated Allocation of Program Benefits and the "New" Fertilizer Subsidies," World Development, Elsevier, vol. 39(7), pages 1166-1176, July.
- Bellemare, Marc F. & Barrett, Christopher B., 2005.
"An Ordered Tobit Model of Market Participation: Evidence from Kenya and Ethiopia,"
14748, Cornell University, Department of Applied Economics and Management.
- Marc F. Bellemare & Christopher B. Barrett, 2006. "An Ordered Tobit Model of Market Participation: Evidence from Kenya and Ethiopia," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(2), pages 324-337.
- Smith, Richard J & Blundell, Richard W, 1986. "An Exogeneity Test for a Simultaneous Equation Tobit Model with an Application to Labor Supply," Econometrica, Econometric Society, vol. 54(3), pages 679-85, May.
- Jacob Ricker-Gilbert & Thomas S. Jayne & Ephraim Chirwa, 2010. "Subsidies and Crowding Out: A Double-Hurdle Model of Fertilizer Demand in Malawi," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 93(1), pages 26-42.
- Nigel Key & Elisabeth Sadoulet & Alain De Janvry, 2000. "Transactions Costs and Agricultural Household Supply Response," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(2), pages 245-259.
- Cameron,A. Colin & Trivedi,Pravin K., 2005. "Microeconometrics," Cambridge Books, Cambridge University Press, number 9780521848053, December.
- A. D. Roy, 1951. "Some Thoughts On The Distribution Of Earnings," Oxford Economic Papers, Oxford University Press, vol. 3(2), pages 135-146.
- Ellis,Frank, 1992. "Agricultural Policies in Developing Countries," Cambridge Books, Cambridge University Press, number 9780521395847, December.
- Coady, David P, 1995. "An Empirical Analysis of Fertilizer Use in Pakistan," Economica, London School of Economics and Political Science, vol. 62(246), pages 213-34, May.
- Esther Duflo & Michael Kremer & Jonathan Robinson, 2009.
"Nudging Farmers to Use Fertilizer: Theory and Experimental Evidence from Kenya,"
NBER Working Papers
15131, National Bureau of Economic Research, Inc.
- Esther Duflo & Michael Kremer & Jonathan Robinson, 2011. "Nudging Farmers to Use Fertilizer: Theory and Experimental Evidence from Kenya," American Economic Review, American Economic Association, vol. 101(6), pages 2350-90, October.
- Liverpool, Lenis Saweda O. & Winter-Nelson, Alex, 2010. "Poverty Status and the Impact of Formal Credit on Technology Use and Wellbeing among Ethiopian Smallholders," World Development, Elsevier, vol. 38(4), pages 541-554, April.
- Michael Morris & Valerie A. Kelly & Ron J. Kopicki & Derek Byerlee, 2007. "Fertilizer Use in African Agriculture : Lessons Learned and Good Practice Guidelines," World Bank Publications, The World Bank, number 6650, July.
- Garth Holloway & Simeon Ehui & Amare Teklu, 2008. "Bayes estimates of distance-to-market: transactions costs, cooperatives and milk-market development in the Ethiopian highlands," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 23(5), pages 683-696.
When requesting a correction, please mention this item's handle: RePEc:fpr:ifprid:1194. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.