What are the Enduring Effects of Fertilizer Subsidy Programs on Recipient Farm Households? Evidence from Malawi

Replaced with revised version of paper 08/23/11.fertilizer subsidies, Malawi, Sub-Saharan Africa, endogeneity, panel data, International Development, Political Economy, C23, C26, Q12, Q13, Q18,

What are the Dynamic Effects of Fertilizer Subsidies on Household Well‐being? Evidence from Malawi

This study uses household level panel data from Malawi to measure the contemporaneous and dynamic impacts of fertilizer subsidies on different indicators of household well‐being. Well‐being is measured in this paper using indicators contained in available survey data, such as area cultivated, maize production, asset wealth, respondent‐stated adequacy of food consumption and respondent-stated life satisfaction. The study uses fixed effects and instrumental variable methods to control for endogeneity caused by the non‐random distribution of targeted fertilizer subsidies. Results indicate that the quantity of subsidized fertilizer acquired by a household has a positive contemporaneous effect on area planted, area planted to maize and maize production at the household level. The subsidy also has a significant dynamic effect on the quantity of maize that households produce. Subsidized fertilizer has no significant contemporaneous or dynamic effect on household asset accumulation. Receiving more subsidized fertilizer does not make households feel that their food consumption has been adequate over the past year, but receiving more subsidized fertilizer makes household heads say that they are more satisfied with their lives. Subsidized fertilizer appears to be going to people with more land. In addition, people in villages where members of parliament reside also receive greater quantities of subsidized fertilizer. These findings raise questions about how subsidy recipients are targeted. Improving targeting could increase the positive impacts of fertilizer subsidies on household well‐being.Food Security and Poverty,

The Impact of Fertilizer Subsidies on National Fertilizer Use: An Example from Malawi

Replaced with revised version of paper 06/30/08.Agricultural and Food Policy, Crop Production/Industries,

Does Subsidizing Fertilizer Increase Yields? Evidence from Malawi

Despite their strain on government and donor budgets, fertilizer subsidies have once again become popular policy tools in several Sub-Saharan Africa countries as a potential way to increase yields in staple crops like maize. Policy makers often assume that farmers who receive the subsidy will achieve yield responses that are similar to those obtained by farmers who pay commercial prices for the input. This notion has not been verified empirically. Our study uses panel data from Malawi, a country that recently implemented a fertilizer subsidy program, to compare maize yield response to fertilizer from farmers who received subsidized fertilizer with yield responses from those who paid commercial prices for the input. Descriptive results indicate that maize plots using commercial fertilizer obtain higher yields per kilogram of fertilizer than maize plots that used subsidized fertilizer. Conversely, the results obtained using a fixed-effects estimator indicate that when other factors are controlled for, maize plots that use subsidized fertilizer obtain a higher yield response than other plots. The results seems to be influenced by a group of farmers who used no fertilizer before the subsidy program began, but used subsidized fertilizer after the program was implemented. This group of farmers obtained significantly higher yields in the year when they receive the subsidy than did the rest of the farmers in the sample during that year. These findings indicate that in order to be effective, government officials should specifically target fertilizer subsidies to farmers who lack access to commercial markets or would not otherwise find it profitable to purchase the input.Malawi, Fertilizer Subsidies, Production Function, Crop Production/Industries,

Malawi’s Maize Marketing System

National food security in Malawi depends on improving the performance of maize markets. Ensuring that grain is consistently available at tolerable prices is crucial for consumers’ food security. At the same time, surplus producing farmers need to receive farm-gate prices consistently above production costs to intensify the use of fertilizer and other productivity enhancing technologies in a sustainable manner. These concerns give rise to the classic food price dilemma for policy makers in Malawi: how to keep prices low enough to ensure low income consumers’ access to food while keeping prices high enough to promote farm production incentives. These tensions cannot be avoided but they can be relieved through reducing food marketing margins, which shrink the wedge between producer and consumer prices. Moreover, Malawi faces major political and economic problems associated with food price instability especially given its dependence on rain fed agriculture in a region prone to drought. These issues show that improving the performance of maize markets is at the core of achieving sustainable food security and poverty reduction in Malawi.food security, Malawi, maize, marketing, food policy, Agricultural and Food Policy, Community/Rural/Urban Development, Food Security and Poverty, International Development, Marketing, q12, q18,

Productivity and welfare effects of Nigeria's e-voucher-based input subsidy program

Article purchased; Available online: 9 May 2017In an attempt to go beyond the so called “smart” subsidies, Nigeria has embarked on a potentially innovative mobile phone-based input subsidy program that provides fertilizer and improved seed subsidies through electronic vouchers. In this article, we examined the productivity and welfare effects of the program using household-level data from rural Nigeria. The article employed instrumental variable regression approach to control for the potential endogeneity of the input subsidy program. Our results suggest that the program is effective in improving productivity and welfare outcomes of beneficiary smallholders. The size of the estimated effects suggests a large improvement in productivity and welfare outcomes. Moreover, the distributional effects of the program suggest no heterogeneity effects based on gender and farm land size. These results are robust to using alternative measurements of program participation. The benefit–cost ratio of 1.11 suggests that the program is marginally cost-effective. Overall, our results suggest that while improving average productivity is a good outcome for improving food security, improving the distributional outcome of the program by targeting the most disadvantaged groups would maximize the program’s contribution to food security and poverty reduction

Estimating the Direct and Indirect Effects of Improved Seed Adoption on Yields: Evidence from DNA-Fingerprinting, Crop cuts, and Self-Reporting in Ethiopia

Farmer adoption of improved crop varieties can potentially increase yields and enhance household welfare in the developing world. However, the presence of measurement errors in household surveys poses a serious challenge to estimating the true returns to adopting improved varieties. This article analyzed the impacts of three sources of measurement error caused by farmers’ misperceptions of the varieties they planted, the area they planted, and the quantities they harvested, on maize yields and input use, using the 2018/19 Ethiopia Socio-economic Survey. These data included DNA-fingerprinting of seed, GPS plot size information, and crop cuts that we compared to farmers’ self-reported estimates of these measures. Doing so allowed us to determine the degree of measurement error in the estimates of improved maize adoption. Results indicated that the measurement error in self-reported adoption of improved maize varieties attenuated their estimated yield gains by 12 percentage points on average. Furthermore, we used the relationship between self-reported and DNA-fingerprinted adoption to disaggregate how much of the yield gains from improved seeds was due to better seed genetics and how much was due to increased effort by the farmers who planted them. We found that improved seed genetics accounted for a 22 percentage point yield increase over traditional seed, and observable effort through increased input use accounted for a 15 percentage point gain for improved varieties on average. Understanding these effects has important implications for justifying the continued funding of development of improved seed varieties and their dissemination to smallholder farmers

Measuring the Impacts of Agricultural Input Subsidies in Sub-Saharan Africa: Evidence from Malawi\u27s Farm Input Subsidy Program

Malawi, a small, land-locked country in south Eastern Africa has been at the forefront of the recent push to reestablish subsidies as a way of boosting agricultural production and improving food security, especially among the poor. Its programs have been widely observed, scrutinized, and emulated. This policy brief examines Malawi’s Farm Input Subsidy Program (FISP) and distills a set of key research findings drawn from research conducted recently at Purdue University

Move blocking strategies in receding horizon control

Abstract — In order to deal with the computational burden of optimal control, it is common practice to reduce the degrees of freedom by fixing the input or its derivatives to be constant over several time-steps. This policy is referred to as “move blocking”. This paper will address two issues. First, a survey of various move blocking strategies is presented and the shortcomings of these blocking policies, such as the lack of stability and constraint satisfaction guarantees, will be illustrated. Second, a novel move blocking scheme, “Moving Window Blocking” (MWB), will be presented. In MWB, the blocking strategy is time-dependent such that the scheme yields stability and feasibility guarantees for the closed-loop system. Finally, the results of a large case-study are presented that illustrate the advantages and drawbacks of the various control strategies discussed in this paper