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Field
Trial Status
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Before
in_development
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After
completed
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Field
Abstract
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Before
Rice is an important crop in West Africa and globally. However, local rice in West Africa is viewed as a second choice among consumers as they prefer imported foreign rice because of perceived quality. From the supply side, there are problems with post-harvest losses and lack of processing. To overcome this problem related to quality and to reduce the post-harvest losses on the supply side, a novel parboiling technology, called GEM (grain-quality enhancer, energy-efficient durable material) technology, was developed and has since been disseminated to some farmers in Benin, Ivory Coast, Togo, and Nigeria. However, like most technologies in Africa, its adoption remains low.
There are multiple reasons that have been advanced for low adoption of technologies, among them is the lack of information, inappropriate technology, credit constraints, risk averseness of the farmers, lack of accompanying inputs, and institutional factors such poor roads that make these technologies less profitable. Incentives to encourage adoption have been recommended in literature and shown to have a long-lasting impact on the use of technologies. However, what type of incentives and where to place to have the maximum behavioural impact (uptake) remains heavily unexplored. In this study, our goal is three-fold. Firstly, we want to compare the effectiveness of a price-matching incentive and a cost-saving (transport coupon) offered to randomly selected group of rice-parboilers on adoption. We expect that credit constrained households will respond more to the cost-saving incentive compared to the price-matching incentive. Secondly, we want to test if encouraged use is correlated with adoption by offering varying amounts of incentives. The hypothesis is that those who experience the technology more under an incentive will use it more after the incentive period as they would have learned and overcome the imperfect information barrier. The last objective is to understand the impact of using the technology on profit, and other household livelihood outcomes.
To achieve these objectives, we select a sample size of 690, a third in the price matching incentive and a third in the cost coupon while the last third is in the control (i.e. not encouraged to adopt). Because there are few actors along the higher end of the agricultural value chain, we do a census of all parboilers in the selected sites (Gagnoa and Boauke in Ivory Coast and Lafia in Nigeria). The sample size is calculated and selected using profit as the main variable even though we wish to understand how the incentives affect adoption, the sample size required for the latter is generally lower than the sample size required to understand the impact of adoption on rice income.
We envisage the use of an instrumental variable approach in the estimation of the impact of the adoption of GEM on rice profit/income with two instruments used in the first stage regression-- categorical variable for the type of incentive (including none), and a continuous variable for the value of the incentive. We will further employ more detailed models to understand the relationships between the types of incentives and adoption like including measures of access to credit, perception of costs, and market.
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After
Rice is an important crop in West Africa and globally. However, local rice in West Africa is viewed as a second choice among consumers as they prefer imported foreign rice because of perceived quality. From the supply side, there are problems with post-harvest losses and lack of processing. To overcome this problem related to quality and to reduce the post-harvest losses on the supply side, a novel parboiling technology, called GEM (grain-quality enhancer, energy-efficient durable material) technology, was developed and has since been disseminated to some farmers in Benin, Ivory Coast, Togo, and Nigeria. However, like most technologies in Africa, its adoption remains low.
There are multiple reasons that have been advanced for low adoption of technologies, among them is the lack of information, inappropriate technology, credit constraints, risk averseness of the farmers, lack of accompanying inputs, and institutional factors such poor roads that make these technologies less profitable. Incentives to encourage adoption have been recommended in literature and shown to have a long-lasting impact on the use of technologies. However, what type of incentives and where to place them to have the maximum behavioural impact (uptake) remains heavily unexplored. In this study, our goal is three-fold. Firstly, we want to compare the effectiveness of a price-matching incentive and a cost-saving (transport coupon) offered to randomly selected group of rice-parboilers on adoption. We expect that credit constrained households will respond more to the cost-saving incentive compared to the price-matching incentive. Secondly, we want to test if adoption of GEM has a positive impact on rice profit. We also study repeat use after the incentive has been used. The hypothesis is that those who experience the technology more under an incentive will use it more after the incentive period as they would have learned and overcome the imperfect information barrier.
To achieve these objectives, we select a sample size of 690, a third in the price matching incentive and a third in the cost coupon while the last third is in the control (i.e. not encouraged to adopt). Because there are few actors along the higher end of the agricultural value chain, we do a census of all parboilers in the selected sites (Gagnoa and Boauke in Ivory Coast and Lafia in Nigeria). The sample size is calculated and selected using profit as the main variable even though we wish to understand how the incentives affect adoption, the sample size required for the latter is generally lower than the sample size required to understand the impact of adoption on rice income.
We envisage the use of an instrumental variable approach in the estimation of the impact of the adoption of GEM on rice profit/income with the randomization into treatment as the instrument. We will further employ more detailed models to understand the relationships between the types of incentives and adoption like including measures of access to credit, perception of costs, and market.
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Field
Trial End Date
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Before
August 31, 2020
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After
August 31, 2021
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Field
Last Published
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Before
May 20, 2019 01:42 PM
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After
August 25, 2024 02:49 PM
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Field
Keyword(s)
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Before
Agriculture
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After
Agriculture
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Field
Intervention (Hidden)
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Before
This experiment will try to answer and test some of the behavioural barriers to adoption and measure the impact of adoption. The trial will have 2 main treatments, i) cost-saving coupon offered on the cost side to cover transport costs, ii) a matching-price incentive for the processed rice. The cost-saving coupon to cover transportation costs is theorized to eliminate one barrier to the adoption of GEM as households would need to transport rice to the GEM and back. Both transport and price incentives will cover a max of 800 kgs of paddy rice and a minimum of 200kg of paddy rice. The coupons for both treatments will be at 3 levels (Incentive for 2 bags (2,000 XOF incentive), 4 bags incentive (4,000 XOF incentive), and 8 bags incentive (8,000 XOF incentive)). This results in equivalent savings per bag processed through GEM. The price matching incentive (equivalent approach to price matching offered by retailers in competition with others, see for example Batsaikhan & Tumennasan, 2017; Kukar-Kinney, Xia, & Monroe, 2007; Srivastava & Lurie, 2001) is tagged at maximum of 4% (similar to 1,000 XOF per bag incentive) of the price of other non-GEM parboiled rice on the market (as of March 2019). This premium follows Etoa et al. (2016) who found consumers were willing to pay a premium of about 5% on GEM parboiled rice in Cameroon. The price matching incentive is a binding promise to the parboilers that a premium on the bags (2, 4, and 8 for some) that they parboil through GEM will be offered once they have parboiled, milled and found market for this rice. Whether they actually sell the rice or not should be inconsequential, as the goal is to observe uptake with the promise of an incentive.
The first treatment allows us to test if parboilers view cost incentives differently from price incentives. The hypothesis is that in a credit-constrained environments, farmers would value more the cost-saving incentives that relax the constraint. In short, we expect farmers who are credit constrained and are not able to pay for the cost of transporting rice to respond more to the transport coupon. However, if costs are or credit is not a constraint but there is a homogenous product in the market, then a price incentive that fetches a premium on the market would be appreciated more than cost-saving incentives. Further, if the cost savings are in terms of labour, and the opportunity cost of labor is low, then the cost incentives will not be appreciated much. Even if the there are little differences in the access to credit, there is strand of literature that shows that smallholders are not costs minimizers and respond differently to output price and input price changes. These incentives will also act as exogenous instruments for assessment of impact at a later stage. The control group will not receive any discount. All groups will receive information about GEM so that they are making informed decisions on whether to adopt or not--reflecting the real situation on the ground where information is provided before a decision on adoption is made.
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After
This experiment will try to answer and test some of the behavioural barriers to adoption and measure the impact of adoption. The trial will have 2 main treatments, i) cost-saving coupon offered on the cost side to cover transport costs, ii) a matching-price incentive for the processed rice. The cost-saving coupon to cover transportation costs is theorized to eliminate one barrier to the adoption of GEM as households would need to transport rice to the GEM and back. Both transport and price incentives will cover a max of 600 kgs of paddy rice. The coupons for both treatments will be 4 bags incentive. This results in equivalent savings per bag processed through GEM. The price matching incentive (equivalent approach to price matching offered by retailers in competition with others, see for example Batsaikhan & Tumennasan, 2017; Kukar-Kinney, Xia, & Monroe, 2007; Srivastava & Lurie, 2001) is tagged at maximum of 4% (similar to 1,000 XOF per bag incentive) of the price of other non-GEM parboiled rice on the market (as of March 2019). This premium follows Etoa et al. (2016) who found consumers were willing to pay a premium of about 5% on GEM parboiled rice in Cameroon. The price matching incentive is a binding promise to the parboilers that a premium on the bags (4 bags) that they parboil through GEM will be offered once they have parboiled, milled and found market for this rice. Whether they actually sell the rice or not should be inconsequential, as the goal is to observe uptake with the promise of an incentive.
The first treatment allows us to test if parboilers view cost incentives differently from price incentives. The hypothesis is that in a credit-constrained environments, farmers would value more the cost-saving incentives that relax the constraint. In short, we expect farmers who are credit constrained and are not able to pay for the cost of transporting rice to respond more to the transport coupon. However, if costs are or credit is not a constraint but there is a homogenous product in the market, then a price incentive that fetches a premium on the market would be appreciated more than cost-saving incentives. Further, if the cost savings are in terms of labour, and the opportunity cost of labor is low, then the cost incentives will not be appreciated much. Even if the there are little differences in the access to credit, there is strand of literature that shows that smallholders are not costs minimizers and respond differently to output price and input price changes. These incentives will also act as exogenous instruments for assessment of impact at a later stage. The control group will not receive any discount. All groups will receive information about GEM so that they are making informed decisions on whether to adopt or not--reflecting the real situation on the ground where information is provided before a decision on adoption is made.
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Field
Building on Existing Work
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Before
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After
No
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