Short‐term versus long‐term decision trade‐offs: Evidence from a model‐based observational experiment with African small‐scale farmers

Abstract

Smallholder farmers in sub‐Saharan Africa recurrently face situations of complex and dynamic decision trade‐offs. Short‐term‐oriented activities such as fertilizer application help to cover immediate food needs but compromise on future food production. Long‐term‐oriented production activities such as building up soil fertility are important systemic leverage points; however, they compromise on today's harvests. This article uses a semicomputerized observational experiment in Zambia to investigate farm management decision making with conflicting production objectives in a dynamic context. The results reveal that, overall, Zambian smallholder farmers have a strong and significant preference for short‐term‐oriented production activities, which leads to a suboptimal performance in production in the long term. A mind shift towards more long‐term‐oriented production activities is required to sustainably increase food production. Our findings point at two things in this regard: First, we identify decision rules that successful performers have applied and that should be the basis for capacity building strategies. Second, we indicate that our approach itself contributed to recognition of the importance of a longer term perspective.

Beyond time preferences—Behavioural causes for short‐term orientation: Comment on the paper by Kopainsky, Gerber, Lara‐Arango, and Nyanga

“…In this commentary on the paper by Kopainsky, Gerber, Lara‐Arango, and Nyanga (), I want to achieve two objectives: First, I want to show how it connects to the increasingly flourishing stream of behavioural research in a broadening variety of fields and, specifically, to behavioural system dynamics. Second, I want to explore further how it extends the knowledge on reasons for short‐term orientation beyond the well‐researched phenomenon of humans preferring (lower) outcomes in the near future over (higher) results in the remote future.…”

“…Yet even the following few examples show the long tradition of the behavioural perspective in System Dynamics: Sterman (), Cronin, Gonzalez, and Sterman (), Moxnes (), Weinhardt, Hendijani, Harman, Steel, and Gonzalez (), Hu, Leopold‐Wildburger, and Strohhecker (). The behavioural study by Kopainsky et al () rests, therefore, on solid footing.…”

“…Using Lane's () map of behavioural system dynamics research, the study can be classified into the behavioural research areas of “Mental Models” (and, to a lesser extent, also to “Encountering the World”). Kopainsky et al () present an experiment conducted in Africa, with “real” smallholder farmers as participants. In their everyday farming work, they face difficult decision situations that require balancing short‐term‐ and long‐term‐oriented activities.…”

“…In the basic intertemporal choice experiment, participants are typically asked a simple choice question, such as “Do you prefer receiving 100 EUR now or 150 EUR in three months?”. Similarly, but closer to the investment task used by Kopainsky et al (), participants could be asked to do the following: “Here are 50 EUR to invest in options A and B. A pays back 100 EUR in one year, B 150 EUR in four years.…”

“…A pays back 100 EUR in one year, B 150 EUR in four years. Which percentage of your funds do you invest in A, which one in B?” Presenting the classic intertemporal choice question in this way and comparing it to the Kopainsky et al () task shows clearly that the latter is of significantly higher complexity. First, the outcome in the intertemporal choice experiment is not uncertain; it is precisely known.…”