Does fertilizer use respond to rainfall variability? Panel data evidence from Ethiopia

Abstract

In this paper we use farmers' actual experiences with changes in rainfall levels and their responses to these changes to assess if patterns of fertilizer use are responsive to changes in rainfall patterns. Using plot and farm level panel data from the central Highlands of Ethiopia matched with corresponding village level rainfall data; results show that both the current year's decision to adopt and the intensity of fertilizer adoption is positively associated with higher rainfall levels experienced in the previous year. Furthermore, we find a concave relationship between previous season rainfall levels and fertilizer adoption, indicating that too much rainfall discourages adoption. Abundant rainfall in the previous year could depict relaxed liquidity constraints and increased affordability of fertilizer, which makes rainfall availability critical in severely credit constrained environments. In light of similar existing literature, the major contribution of the study is its use of plot level panel data, which permits us to investigate the importance of plot characteristics in fertilizer adoption decisions.

Improving Welfare Through Climate-Friendly Agriculture: The Case of the System of Rice Intensification

“…SRI adopter farm households in this case enjoy TZS 427,000 more farm profit/acre compared with the scenario of not adopting. This is a key finding which adds to the technology adoption literature in developing countries that uninsured ex-post risk (such as unpredictable output price) may discourage farmers from adopting new productivity-enhancing modern agricultural technologies (Alem et al 2010, Dercon and Christiaensen, 2011, Alem and Broussard, 2013.…”

Farm income, gender differentials and climate risk in Cameroon: typology of male and female adaptation options across agroecologies

“…As revealed in Table 2, about 55% of women farmers in the humid forest zone rely on soil amendments such as farmyard manure, as opposed to 63 and 76% of farmers in the high savannah and Sahel savannah, respectively. The use of fertiliser as a response option to climate variability is corroborated in Alem et al (2010), who find evidence that fertiliser use responds to rainfall variability, with the intensity of current year's fertiliser use positively associated with higher rainfall levels experienced in the previous year. The inaccessibility to fertilizer means that producers rely on alternatives such as mulching and increased multiple crop.…”

“…While traditional credit systems (rotating savings) often include a lending possibility, which is used for consumption purposes, informal credit markets also appear to adjust to high-risk environments. For instance, accessibility to credit possibly accounts for the observed disparity in the study regions in the use of fertilizer, and as Alem et al (2010) note abundant rainfall in the previous year could depict relaxed liquidity constraints and increased affordability of fertilizer, which makes rainfall availability critical in severely credit-constrained environments.…”

Farmer risk-aversion limits closure of yield and profit gaps: A study of nitrogen management in the southern Australian wheatbelt

“…Importantly, we recognise that the current site practice rates referred to here may reflect the risk farmers have experienced over only part of the historical period modelled. This is particularly relevant after a longer drier period (in the lower rainfall site), when the memory of the recent dry years likely affects management, hence contributing to more conservative site practice rates (Alem et al, 2010;Picazo-Tadeo and Wall, 2011). While for clarity we focus on the use of single site practice rates in this study, it should be noted that this does not recognise the broad range of N rates used by farmers over the range of soils and situations in a region, including those using variable rate fertiliser application within-fields.…”