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Agricultural Technology Choice and Transport

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World Bank (WB)

Abstract: This paper addresses an old and recurring theme in development economics: the slow adoption of new technologies by farmers in many developing countries. The paper explores a somewhat novel link to explain this puzzle -- the link between market access and the incentives to adopt a new technology when there are non-convexities. The paper develops a theoretical model to guide the empirical analysis, which uses spatially disaggregated agricultural production data from Spatial Production Allocation Model and Living Standards Measurement Study survey data for Nigeria. The model is used to estimate the impact of transport costs on crop production, the adoption of modern technologies, and the differential impact on returns of modern versus traditional farmers. To overcome the limitation of data availability on travel costs for much of Africa, road survey data are combined with geographic information road network data to generate the most thorough and accurate road network available. With these data and the Highway Development Management Model, minimum travel costs from each location to the market are computed. Consistent with the theory, analysis finds that transportation costs are critical in determining technology choices, with a greater responsiveness among farmers who adopt modern technologies, and at times a perverse (negative) response to lower transport costs among those who employ more traditional techniques. In sum, the paper presents compelling evidence that the constraints to the adoption of modern technologies and access to markets are interconnected, and so should be targeted jointly.
Type: Working Paper
Publications & Research
Publications & Research :: Policy Research Working Paper
Link: http://hdl.handle.net/10986/22003
Subject: LIVING STANDARDS
TRADITIONAL TECHNOLOGY
PURCHASE PRICE
COSTS OF TRAVEL
PRICE OF FUEL
PRODUCTION
INCOME
VEHICLE SPEED
TRANSPORT INFRASTRUCTURE
TRANSPORTATION COSTS
FREIGHT TRANSPORT
ELASTICITY OF DEMAND
INFORMATION
LIQUIDITY
ELASTICITY
POLITICAL ECONOMY
WELFARE
INCENTIVES
DIMINISHING RETURNS
TRAVEL SPEED
VARIABLES
MODELS
SYSTEM
IMPACT OF TRANSPORT COSTS
HIGHWAY SYSTEM
TAX
INPUTS
CITIES
DECISIONS
GROSS VEHICLE WEIGHT
RETURNS TO SCALE
WEALTH
CODES
AGRICULTURAL OUTPUT
TRANSPORTATION INFRASTRUCTURE
TRENDS
ROAD TYPE
LITERACY
PRICE INCENTIVES
INCREASING RETURNS TO SCALE
KNOWLEDGE
TRAVEL COSTS
DEVELOPMENT
NEW TECHNOLOGIES
CHOICE
VEHICLE
DATA
INFLUENCE
TOTAL FACTOR PRODUCTIVITY
ROAD
DIGITAL
COSTS
TRANSPORTATION NETWORK
DEVELOPMENT ECONOMICS
ROAD NETWORK
TRANSPORT
IMPACT OF TRANSPORT
FIXED COSTS
PRODUCTIVITY
EXTERNALITIES
INDUSTRIALIZATION
FAILURES
INCREASING RETURNS
MARKETS
CONNECTIVITY
COSTS PER VEHICLE
LEARNING
PIXELS
CULTURAL CHANGE
RESEARCH
TRAVEL TIMES
UTILITY
ROUTE
ROAD QUALITY
INFRASTRUCTURE
TECHNOLOGY
PRODUCTIVITY GROWTH
HUMAN CAPITAL
TECHNOLOGICAL CHANGE
RADAR
TRAVEL
TRANSPORTATION
WAGES
POLICIES
ECONOMIC OUTCOMES
BASIC
PARTICIPATION
VALUE
PRODUCTION FUNCTIONS
ELASTICITIES
CREDIT
ALTERNATIVE TECHNOLOGIES
ACCESSIBILITY
SYSTEMS
RURAL INFRASTRUCTURE
UTILITY FUNCTION
AGRICULTURE
DECISION MAKING
MEASUREMENT
UNDERDEVELOPMENT
ENDOGENOUS VARIABLES
POLICY
PRODUCTION FUNCTION
ROADS
FUNCTIONAL FORMS
WALKING
HIGHWAY
TRADE
RAILROAD
VEHICLE COST
GOODS
THEORY
TRANSPORTATION COST
INVESTMENT
COMPARATIVE ADVANTAGE
TRANSACTIONS COSTS
FUEL
COMPETITIVE MARKETS
REVENUE
INVESTMENTS
IT
NEW TECHNOLOGY
AT
PEDESTRIANS
ECONOMIC GEOGRAPHY
TRANSPORT COSTS
TECHNOLOGIES
OUTCOMES
TRAVEL TIME
FUEL COST
FREIGHT
ATTRIBUTES
INNOVATIONS
ENGINEERS
DEVELOPMENT POLICY




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