why don't low productivity farmers adopt high return...
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brown-logo.pdf
Farmers Markets Planners
Why don’t low productivity farmers adopt highreturn investments?
Andrew Foster
November 4, 2016
Andrew Foster
Why don’t low productivity farmers adopt high return investments?
brown-logo.pdf
Farmers Markets Planners
What is exactly a high return investment?
Samphantharak and Townsend “Measuring the return onhousehold enterprise: What matters most for whom?”
Cash versus accrualCosting out household assets
Foster and Rosenzweig “Are Indian Farms Too Small?Mechanization, Agency Costs, and Farm Efficiency
Yield, profits, rental price scale
Labor costsCredit costs
Beaman, Karlan, Thuysbaert, Udry ”Profitability of Fertilizer:Experimental Evidence from Female Rice Farmers in Mali”
Complicated for farmers to assess given multiple changes
Andrew Foster
Why don’t low productivity farmers adopt high return investments?
brown-logo.pdf
Farmers Markets Planners
To what extent must methods be adopted to localconditions?
Bustos and Ponticelli “Agricultural productivity and structuraltransformation. evidence from brazil. Evidence from Brazil”
Natural variation interacts importantly with features ofsoil/climate
Roy et al, “The phosphorus cost of agricultural intensificationin the tropics”
Subtle differences in ways soil holds nutrients affects resourcecosts phos
Andrew Foster
Why don’t low productivity farmers adopt high return investments?
brown-logo.pdf
Farmers Markets Planners
How do we reduce the risks associated with technologyadoption?
Rosenzweig and Udry, “Forecasting profitability”
Improving forcasts may reduce the downside risk of technologyadoption forc
Jack, Oliva, Bell, Severen and Walker Technology adoptionunder uncertainty: Take-up and subsequent investment inZambia
Expansion in risk may increase adoption but decreasefollow-through
Carter, Laajaj, and Yang “Savings, Subsidies, and TechnologyAdoption: Field Experimental Evidence from Mozambique”
Posible evidence that savings substitutes for technologyadoption
Andrew Foster
Why don’t low productivity farmers adopt high return investments?
brown-logo.pdf
Farmers Markets Planners
What do we do with ambiguity, hyperbolic discounting,and amenities?
Elabed and Carter. Compound Risk Aversion, Ambiguity andthe Willingness to Pay for Microinsurance,
Compound lottery aversion
Casaburi and Willis “Time vs. State in Insurance:Experimental Evidence from Kenya Contract Farming”
Allowing to pay ex-post makes a large difference in terms ofuptake ambig
Kala “Learning and adaptation: Evidence from IndianAgriculture”
Ambiguity aversion and recency bias
Andrew Foster
Why don’t low productivity farmers adopt high return investments?
brown-logo.pdf
Farmers Markets Planners
To what extent is productivity influenced by factor marketsand prices?
Foster and Rosenzweig “Are Indian Farms Too Small?Mechanization, Agency Costs, and Farm Efficiency
Mechanization is complementary with land scale
Pellegrina “The Causes and Consequences of AgriculturalSpecialization in Brazil”
General equilibrium model incorporating input and ouputmarket costs as well as land suitability to understand whereproducts grow. factor
Gafaro “Private Property Rights, Land Markets andAgriculture”
Property rights decrease agricultural investment due to exit ofhigher skilled farmers
Andrew Foster
Why don’t low productivity farmers adopt high return investments?
brown-logo.pdf
Farmers Markets Planners
How do we reduce quality heterogeneity in input markets?
Bold, Kaizzi, Svensson, and Yanagizawa-Drott, “LemonTechnologies and Adoption: Measurement, Theory andEvidence from Agricultural Markets in Uganda”
Nutrient packets from local markets are of heterogeneousquality, which complicates inference problem input
Emerick ”Identity and the exchange of goods in villageeconomies ”
Local markets for product seeds did not develop despite gooduptake of seeds delivered by NGO
Andrew Foster
Why don’t low productivity farmers adopt high return investments?
brown-logo.pdf
Farmers Markets Planners
What are the best ways to improve access to productmarkets?
Gafaro, Transport costs and the commodification ofagriculture
Importance of fixed costs in understanding whichareas/farmers move to cash crops product
Pellegrina “The Causes and Consequences of AgriculturalSpecialization in Brazil”
Role of trade and transport to coast in changing the spatialdistribution of agricultural production.
Andrew Foster
Why don’t low productivity farmers adopt high return investments?
brown-logo.pdf
Farmers Markets Planners
Do farmers have the right incentives to learn and to teach?
Foster and Rosenzweig, “Learning by Doing and Learning fromOthers: Human Capital and Technical Change in Agriculture”
Is the learning of neighboring farmers complements orsubstitutes? learn
BenYishay and Mobarak, Social Learning and Incentives forExperimentation and Communication
Pay for performance increases teaching (and possibly learning)
Hardy, “It Takes Two: Experimental Evidence on theDeterminants of Technology Diffusion”
Rivalry may decrease transmission of information
Andrew Foster
Why don’t low productivity farmers adopt high return investments?
brown-logo.pdf
Farmers Markets Planners
Do farmers appropriately internalize the environmentalconsequences of agricultural investment?
David Glick Pass the Salt: Salinity and Credit in Rural Indiasalt
Subtle difference in respond to input credit by salination level
Foster and Nagarajan “Spillovers, Coordination Failure, andthe Consequences of Fragmentation in Rural India”
Evidence of uninternalized negative spillovers acrossneighboring plots.
Gine and Jacoby, Contracting under Uncertainty:Groundwater in South India
Uncertainty and hold up complicates contracting overgroundwater.
Andrew Foster
Why don’t low productivity farmers adopt high return investments?
brown-logo.pdf
Farmers Markets Planners
What can experts do?
Beaman, BenYishay, Magruder and Mobarak “Can NetworkTheory-based Targeting Increase Technology Adoption?”
Need to learn from multiple sources particularly from farmerswith comparable circumstances exten
Gao and Foster “Does a History of Public Health SuccessLead to Improvements in Public Health Efficacy? Evidencefrom the WHO Smallpox Eradication Program in India andWest Africa”
Importance of success in determining responsiveness toextrenal information
Andrew Foster
Why don’t low productivity farmers adopt high return investments?
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Figure: Yield and Profits by Acres in India
-2000
0
2000
4000
6000
8000
10000
12000
14000
0 2 4 6 8 10 12 14 16 18 20
Output value
Profit, lower-bound wage
Profit, upper-bound wage
Profit, zero-cost family labor
Figure 3. Measures of Per-Acre Productivity, by Owned Landholding Size (2007-8)
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Andrew Foster
Why don’t low productivity farmers adopt high return investments?
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Figure: Adoption of HYV
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Andrew Foster
Why don’t low productivity farmers adopt high return investments?
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Figure: Deduction Premia
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Andrew Foster
Why don’t low productivity farmers adopt high return investments?
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Figure: Increased Forecast Ability
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Andrew Foster
Why don’t low productivity farmers adopt high return investments?
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Figure: Effect of Credit on Land Cultivated
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Andrew Foster
Why don’t low productivity farmers adopt high return investments?
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Figure: Trajectories of Phosphate Use and Value of Agriculture
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Andrew Foster
Why don’t low productivity farmers adopt high return investments?
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Figure: Where are land intensive crops growth?
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Andrew Foster
Why don’t low productivity farmers adopt high return investments?
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Figure: Output with different qualities of fertilizer
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Andrew Foster
Why don’t low productivity farmers adopt high return investments?
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Figure: Factor prices change with market access
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Andrew Foster
Why don’t low productivity farmers adopt high return investments?
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Figure: Uptake based on various learning structures
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Andrew Foster
Why don’t low productivity farmers adopt high return investments?