The Demand for Advice: Theory and Empirical Evidence from Farmers in Sub-Saharan Africa

Abstract

The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

Technology Adoption Under Costly Information Processing

“…In addition, different values of $$\mu$$ may capture the effect of external interventions that help users to reduce uncertainty about optimal usage practices. For example, this may include the provision of advisory services (Naeher and Schündeln, 2021), access to infrastructure, and tools such as a hotline (Cole and Fernando, 2012) or simply a user manual, which are helpful in reducing uncertainty about optimal usage practices. Irrespective of the underlying sources of variation in $$\mu$$, the effect on optimal input decisions in the model is summarized by the following corollary:Corollary Users facing a lower cost $$\mu$$ of processing information require a lower threshold in attentional capacity to adopt technology, and to combine complementary input technologies in the same production location.…”