Crop‐Level Supply Response by Agro‐Climatic Region in Ethiopia

Abstract

Using farm‐level survey data from Ethiopia, this paper estimates a quadratic restricted profit function to assess the supply response of smallholder farmers. All major crops are identified in the analysis and variations in agro‐climatic and farming systems are accounted for. Peasant farmers, at least in the more commercial Central and Southern zones, do respond positively and significantly to price incentives. Farmers in the Northern zone are least commercial and least responsive to prices, and in fact the model based on profit maximisation does not adequately capture their behaviour. In general, non‐price factors, especially rainfall and market access, are more important than prices in affecting poduction, and which factors are most important varies depending on the crop and region in question. We conclude with suggestions regarding which crops appear most suitable to each agro‐climatic region, and identify the most relevant policy interventions in each case.

Measuring Farm and Market Level Economic Impacts of Improved Maize Production Technologies in Ethiopia: Evidence from Panel Data

“…As there is one market for maize, an overall yield and cost ATT have been calculated using adoption level ( A ) as a weight to estimate the yield and cost ATT share contributed by a specific technology combination. The price supply elasticity value (ϵ) in equation is, set at 0.5 (Abrar et al ., ).…”

“…As there is one market for maize, an overall yield and cost ATT have been calculated using adoption level (A) as a weight to estimate the yield and cost ATT share contributed by a specific technology combination. The price supply elasticity value (e) in equation (8) is, set at 0.5 (Abrar et al, 2004). The K-shift parameter along with observed maize price (P 1 ) and other parameters are used to compute the counterfactual equilibrium price (P 0 ) that would prevail if the technology were not adopted, following Alston et al (1995):…”

Consumption risk, technology adoption and poverty traps: Evidence from Ethiopia

“…Fertilizer use in Ethiopia has remained limited despite concerted efforts by the government to promote its adoption through improved extension services and access to credit. A host of demand and supply side factors have been invoked to explain the limited adoption of fertilizer in Ethiopia 1 including limited knowledge and education (Asfaw and Admassie, 2004), risk preferences, credit constraints (Croppenstedt, Demeke and Meschi, 2003), limited profitability of fertilizer use (Dadi, Burton, and Ozanne, 2004;World Bank, 2006b), lack of market access (Abrar, Morrissey, and Rayner, 2004) as well as limited or untimely availability of the inputs themselves. Carlsson, et al (2005), the World Bank (2006a) and anecdotal evidence 2 have recently also highlighted the importance of households' limited ex post consumption smoothing capacity.…”

Is increasing inorganic fertilizer use for maize production in SSA a profitable proposition? Evidence from Nigeria

“…These include limited or untimely availability of the input (Carlsson et al, 2005, World Bank, 2006), imperfect markets (Abrar et al, 2004), lack of agronomic knowledge (Asfaw and Admassie, 2004), riskiness and credit constraints (Croppenstedt et al, 2003) and economies of scale in supply––which have all been invoked to give rise to “market smart subsidies”. While there are signs of an increase in fertilizer use, especially in those countries with subsidy programs (Nigeria, Malawi, and Zambia) or other concerted support (Ethiopia), fertilizer use generally remains low (Sheahan and Barrett, 2014, Sommer et al, 2013, Montpellier Panel, 2013, Banful et al, 2010).…”