Enabling farmers to prepay for fertilizer when they had cash on hand was effective in promoting fertilizer adoption.
- Farmers had high demand for the ability to purchase fertilizer in advance. Among farmers who were offered advanced purchasing, 31 percent bought fertilizer in the first season of the program, and 39 percent bought it in the second season. The incentive offered to the farmers was small (free delivery), suggesting that farmers were attracted by the ability to commit to purchasing fertilizer in advance.
- Fertilizer adoption increased while advanced purchasing was offered, but once the program was removed, fertilizer usage went back to what it had been. Fertilizer adoption went up by 11-14 percentage points among farmers who were offered advanced purchasing. When the program ended, farmers in the treatment group reverted back to the same level of adoption as the comparison group.
- Prepayment had an impact on adoption comparable to a large subsidy during the growing season. Providing farmers with the option to purchase fertilizer in advance was as effective at increasing fertilizer adoption as a 50-percent discount, offered at the time when fertilizer needed to be applied.
October 01, 2011