EfD Discussion Paper,
Environment for Development, University of Gothenburg

Abstract: The study investigates determinants of willingness to pay (WTP) for laser land leveling (LLL) technique, its demand heterogeneity across individual farmers and plot characteristics, and the technique empirical impact on paddy productivity. The study applies the Becker-DeGroote, Marschak style to elicit the WTP for LLL technique and the Cragg model to examine the determinants of the WTP to capture both the demand decision and affordability. The randomized controlled trials (RCT) incorporate with a production function model to analyze the technique effects on paddy productivity. The Cragg model finds that the key demographic and behavioral traits such as age, extension services, and risk acceptance significantly influence the adoption decision; however, the plot area, bank and financial capacity become predominant factors to the adoption affordability. The LLL treatment effect results in a statistically significant increase in paddy yield of 6.48%, equivalent to 492,138 kg ha-1 . The analysis underscores the factor complexity, illustrating that the LLL promoting interventions need to address both the adoption barriers and the enablers for a greater affordability. A composite of climate-smart agricultural programs should be employed to facilitate the LLL adoption. The empirical evidence highlights the positive effect on the agricultural productivity, potentially offering a significant boost to output and farmer income. The study contributes to existing literature by analyzing the heterogeneous demand for LLL technique with two distinguishable features of paddy mono-cropping system and land fragmentation and by incorporating the RCTs alongside a production function for the effects on paddy productivity.

Keywords: Laser land leveling; Demand heterogeneity; Land fragmentation; Paddy productivity; Randomized controlled trials; Mekong Delta; Vietnam

JEL-codes: Q15

Language: English

38 pages, May 12, 2025

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JADEE-04-2024-0142  Full text

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