Scandinavian Working Papers in Economics
Working Papers in Economics,
University of Gothenburg, Department of Economics
No 556: Do Safety Nets Promote Technology Adoption? Panel data evidence from rural Ethiopia
Yonas Alem () and Nzinga H. Broussard ()
Additional contact information
Yonas Alem: School of Business, Economics and Law, Postal: Department of Economics., University of Gothenburg, P.O.Box 640, SE 40530 GOTHENBURG, Sweden
Nzinga H. Broussard: The Ohio State University, Postal: 410 Arps Hall , 1945 North High St. , Columbus, OH 43210, U.S.A.
Abstract: We use panel data from rural Ethiopia to investigate if participation in a safety net program enhances fertilizer adoption. Using a difference-in-difference estimator and inverse propensity score weighting we find that participation in Ethiopia’s food-for-work program increased fertilizer adoption. Results also indicate that the likelihood of adopting and the intensity of fertilizer usage increased with livestock holdings for food-for-work-participant households providing some evidence that the intervention helped asset-rich farm households more than asset-poor households. We find no significant effects of free distribution on fertilizer adoption or intensification. Our results are consistent with the hypothesis that safety nets can be viewed as mechanisms that allow households to take on more risk to pursue higher profits. The paper highlights important policy implications related to the inter-related dynamics of safety nets and extension services that aim at promoting productivity enhancing modern agricultural technologies.
Keywords: Safety Net; Fertilizer Use; Inverse Propensity Score Weighting
23 pages, February 28, 2013
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