Resource information
This paper investigates the reasons for
the low application of external fertilizers on farms in
Kenya and Uganda. The analysis uses a large panel of
household data with rich soil fertility data at the plot
level. The authors control for maize seed selection and
household effects by using a fixed-effects semi-parametric
endogenous switching model. The results suggest that Kenyan
maize farmers have applied inorganic fertilizer at the
optimal level, corresponding to the high nitrogen-maize
relative price, in one of the two survey years and also
responded to the price change over time. In Uganda, even the
low application of inorganic fertilizer is not profitable
because of its high relative price. The authors conclude
that policies that reduce the relative price of fertilizer
could be effective in both countries, while the efficacy of
policies based on improving farmers' knowledge about
fertilizer use will be limited as long as the relative price
of fertilizer remains high.
