Working Paper: NBER ID: w26208
Authors: Michael Carter; Rachid Laajaj; Dean Yang
Abstract: The Green Revolution bolstered agricultural yields and rural well-being in Asia and Latin America, but bypassed sub-Saharan Africa. We study the first randomized controlled trial of a government-implemented input subsidy program (ISP) in Africa. A temporary subsidy for Mozambican maize farmers stimulates Green Revolution technology adoption and leads to increased maize yields. Effects of the subsidy persist in later unsubsidized years. In addition, social networks of subsidized farmers benefit from spillovers, experiencing increases in technology adoption, yields, and beliefs about the returns to the technologies. Spillovers account for the vast majority of subsidy-induced gains. ISPs alleviate informational market failures, stimulating learning about new technologies by subsidy recipients and their social networks
Keywords: Input Subsidies; Green Revolution; Agricultural Productivity; Randomized Controlled Trial; Mozambique
JEL Codes: O12; O33; O55; Q12
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Temporary subsidy for maize farmers (Q16) | Increases maize yields (Q16) |
| Temporary subsidy for maize farmers (Q16) | Lasting impact on technology adoption (O33) |
| Spillovers from subsidized farmers to their social networks (Z13) | Increased yields (Q15) |
| Spillovers from subsidized farmers to their social networks (Z13) | Majority of subsidy-induced gains (H23) |
| ISPs alleviate informational market failures (L96) | Stimulating learning about new technologies among subsidy recipients and their social networks (O35) |
| Spillover effects from subsidized farmers (H23) | Enhanced overall effectiveness of the subsidy program (H23) |