Subsidies and the African Green Revolution: Direct Effects and Social Network Spillovers of Randomized Input Subsidies in Mozambique
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
The BASIS Assets and Market Access Innovation Lab the United States Agency for International Development (grant number EDHA-00-06-0003-00) provided financial support for this study. We are also indebted to the International Fertilizer Development Corporation for their close collaboration, and in particular we thank Alexander Fernando, Robert Groot and Marcel Vandenberg. Aniceto Matias and Ines Vilela provided outstanding field management. We thank Luc Behaghel, Doug Gollin, Karen Macours, Craig McIntosh, Karthik Muralidharan and seminar participants at the NBER Transforming Rural Africa Workshop in Cambridge, MA, Barcelona GSE Summer Forum 2014, PACDEV 2014, MIEDC 2014, Paris School of Economics, UC Davis, UC San Diego and UC San Francisco for helpful feedback. We obtained IRB approval from the University of Michigan (HUM00033387). The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.
Michael Carter & Rachid Laajaj & Dean Yang, 2021. "Subsidies and the African Green Revolution: Direct Effects and Social Network Spillovers of Randomized Input Subsidies in Mozambique," American Economic Journal: Applied Economics, vol 13(2), pages 206-229. citation courtesy of