“Low Quality, Low Returns, Low Adoption: Evidence from the Market for Fertilizer and Hybrid Seed in Uganda”
On Wednesday, April 6th, at 2.30pm, the NOVAFRICA Center welcomes Jakob Svensson, from the Institute for International Economic Studies to present his work on the effects of fertilizer and seed quality on agricultural productivity.
To reduce poverty and food insecurity in Africa requires raising productivity in agriculture. Systematic use of fertilizer and hybrid seed is a pathway to increased productivity, but adoption of these technologies remains low. We investigate whether the quality of agricultural inputs can help explain low take-up. Testing modern products purchased in local markets, we find that 30% of nutrient is missing in fertilizer, and hybrid maize seed contains less than 50% authentic seeds. We document that such low quality results in zero average returns. If authentic technologies replaced these low-quality products, average returns for smallholder farmers would close to 80%. We further show, using a simple Bayesian learning model and data from our agricultural trials, that inferring quality from experimentation is difficult unless there are very large shortfalls in quality – findings that can help explain the low quality equilibrium we observe but also explain why the market has not fully collapsed.
Please find further information about this seminar here.