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Heterogeneous returns to chemical fertilizer at the intensive margins: insights from Nepal


Takeshima, H and Adhikari, RP and Shivakoti, S and Kaphle, BD and Kumar, A, Heterogeneous returns to chemical fertilizer at the intensive margins: insights from Nepal, Food Policy, 69 pp. 97-109. ISSN 0306-9192 (2017) [Refereed Article]

Copyright Statement

Copyright 2017 Elsevier Ltd.

DOI: doi:10.1016/j.foodpol.2017.03.007


Increased fertilizer use is considered important for agricultural development in low-income countries. Promoting increased use of chemical fertilizer by lowering its price may be ineffective if demand is price inelastic. In theory, the price elasticity of demand depends on the returns to its use, but the evidence is scarce. Furthermore, while returns are often estimated for small changes in chemical fertilizer use, returns to larger changes in its use (intensive margins) are less understood. Through the inter-zonal comparisons in Nepal, we provide indicative evidence that greater returns to chemical fertilizer are associated with greater price elasticities of demand. Moreover, the evidence suggests that returns at the intensive margins, rather than returns to small changes, may largely account for inter-zonal differences in returns to chemical fertilizer within Nepal. The results suggest that better understanding the returns at the intensive margins is critical for effective agricultural inputs policies in developing countries.

Item Details

Item Type:Refereed Article
Keywords:returns to chemical fertilizer, intensive margins, generalized Double-Hurdle model, generalized propensity score, inverse probability weighting, Nepal
Research Division:Agricultural, Veterinary and Food Sciences
Research Group:Agriculture, land and farm management
Research Field:Farm management, rural management and agribusiness
Objective Division:Economic Framework
Objective Group:Management and productivity
Objective Field:Management and productivity not elsewhere classified
UTAS Author:Adhikari, RP (Dr Rajendra Adhikari)
ID Code:116955
Year Published:2017
Web of Science® Times Cited:23
Deposited By:Tasmanian Institute of Agriculture
Deposited On:2017-05-25
Last Modified:2018-05-22

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