Scandinavian Working Papers in Economics
Working Papers in Economics,
University of Gothenburg, Department of Economics
No 407: The Role of Production Risk in Sustainable Land-Management Technology Adoption in the Ethiopian Highlands
Menale Kassie (), Mahmud Yesuf () and Gunnar Köhlin ()
Additional contact information
Menale Kassie: Environmental Economics Policy Forum for Ethiopia, Ethiopian Development Research Institute, Postal: Blue Building/Addis Ababa near National Stadium, P.O. Box 2479, Addis Ababa, Ethiopia
Mahmud Yesuf: Environmental Economics Policy Forum for Ethiopia, Ethiopian Development Research Institute, Postal: Blue Building/Addis Ababa near National Stadium, P.O. Box 2479, Addis Ababa, Ethiopia
Gunnar Köhlin: Department of Economics, School of Business, Economics and Law, Göteborg University, Postal: Box 640, SE 40530 GÖTEBORG
Abstract: This paper provides empirical evidence of production risk impact on sustainable land- management technology adoption, using two years of cross-sectional plot-level data collected in the Ethiopian highlands. We used a moment-based approach, which allowed a flexible representation of the production risk (Antle 1983, 1987). Mundlak’s approach was used to capture the unobserved heterogeneity along with other regressors in the estimation of fertilizer and conservation adoption. The empirical results revealed that impact of production risk varied by technology type. Production risks (variance and crop failure as measured by second and third central moments, respectively) had significant impact on fertilizer adoption and extent of adoption. However, this impact was not observed in adoption of conservation technology. On the other hand, expected return (as measured by the first central moment) had a positive significant impact on both fertilizer (adoption and intensity) and conservation adoption. Economic instruments that hedge against risk exposure, including downside risk and increase productivity, are important to promote adoption of improved technology and reduce poverty in Ethiopia.
Keywords: Production risk; sustainable land management technology adoption; moment based estimation; Ethiopia
JEL-codes: C33; D13; D81; O33; Q24
29 pages, November 30, 2009
Full text files
21498 HTML file
Questions (including download problems) about the papers in this series should be directed to Jessica Oscarsson ()
Report other problems with accessing this service to Sune Karlsson ().
RePEc:hhs:gunwpe:0407This page generated on 2024-11-14 18:33:27.