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Heterogeneous returns and the persistence of agricultural technology adoption

  • Francis Teal
  • Andrew Zeitlin
  • Stefano Caria

In this paper we explore whether low rates of sustained technology use can be explained by heterogeneity in returns to adoption.� To do so we evaluate impacts of the Cocoa Abrabopa Association, which provided a package of fertilizer and other inputs on credit to cocoa farmers in Ghana.� High estimated average productive impacts for treated farmers are found to be consistent with negative economic profits for a substantial proportion of the treated population.� By constructing an individual-specific measure of returns, we demonstrate that low realized returns among adopters are associated with low retention rates, even after conditioning on output levels and successful repayment.� The results are consistent with the hypothesis that high average returns mask substantial and persistent heterogeneity, and that farmers experiment in order to learn about their idiosyncratic returns.

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Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number CSAE WPS/2010-37.

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Date of creation: 01 Nov 2010
Date of revision:
Handle: RePEc:oxf:wpaper:csae-wps/2010-37
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  10. Field, Erica Marie, 2005. "Property Rights and Investment in Urban Slums," Scholarly Articles 3634150, Harvard University Department of Economics.
  11. Esther Duflo & Michael Kremer & Jonathan Robinson, 2008. "How High Are Rates of Return to Fertilizer? Evidence from Field Experiments in Kenya," American Economic Review, American Economic Association, vol. 98(2), pages 482-88, May.
  12. Ana C. Dammert, 2009. "Heterogeneous Impacts of Conditional Cash Transfers: Evidence from Nicaragua," Economic Development and Cultural Change, University of Chicago Press, vol. 58(1), pages 53-83, October.
  13. Andrew D. Foster & Mark R. Rosenzweig, 2010. "Microeconomics of Technology Adoption," Annual Review of Economics, Annual Reviews, vol. 2(1), pages 395-424, 09.
  14. Djebbari, Habiba & Smith, Jeffrey A., 2008. "Heterogeneous Impacts in PROGRESA," IZA Discussion Papers 3362, Institute for the Study of Labor (IZA).
  15. Andrew D. Foster & Mark R. Rosenzweig, 2010. "Microeconomics of Technology Adoption," Working Papers 984, Economic Growth Center, Yale University.
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