Project

NORHED Project on Capacity Building for Climate Smart Natural Resource Managment and Policy (CLISNARP)

Goal: Ethiopia and Malawi have been implementing a number of development interventions to address development challenges like natural resource degradation, food insecurity, poverty, and adaptation and mitigation of climate change impacts. The two countries are among the sub-Saharan African (SSA) countries with a number of common development challenges ahead as implied by their low level of development indicators.
In this regard, it is very crucial to search for policy options that could create win-win situations whereby viable options can lead to more growth, less poverty and improved and sustainable management of natural resources. These require scholarly capacity in the area of the economics of climate smart natural resource management and policy analysis in the two south partner countries (Ethiopia and Malawi). In particular, such expertise at the higher education institutions has a paramount importance to undertake advanced and innovative research and research based education, and to increase knowledge and its use for policy decision making. However, there is lack of technical capacity at individual and at higher education institutions of the two countries. Thus, based on the above background the NORHED-CLISNARP project has been designed as a collaborative research and capacity-building project by three partner universities (Mekelle University, Lilongwe University of Agriculture and Natural Resources, and Norwegian University of Life Sciences).
The goal of the project is strengthening education and research capacity in economics of climate smart agriculture, natural resource management, and policy at MU and LUANAR in partnership with NMBU.

Project budget: 18 Million NOK

Funding Organization: Norwegian Agency for Development Cooperation (NORAD)

Project duration: Five years (January 2013 – December 2018)

Major Components: Full scholarships for 15 PhDs and 20 M.Sc., a postdoctoral fellowship and institutional development.

Partners Institutions: Mekelle University, Department of Economics (Ethiopia), Lilongwe University of Agriculture and Natural Resources (Malawi), Norwegian University of Life Sciences, School of Economics and Business (Norway)

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Project log

Stein Terje Holden
added a research item
This study provides the initial survey data from a sample of 764 students at the Lilongwe University of Agriculture and Natural Resources (LUANAR), Lilongwe, Malawi. It aims to provide evidence on the extent of exposure to the pandemic among university students, their knowledge and beliefs related to the corona virus and the ways to protect oneself against getting infected, the sources of information that the students rely on, and other factors influencing their knowledge, beliefs, and behavior. The study was undertaken in the period of February-March 2022 during which the fourth wave of the pandemic in the country took place and in this period the omicron variant of the virus dominated. The result of the study shows that 17.5% of the students reported that they thought they had been infected by the corona virus. But only 23.9% of these had tested themselves for being infected and 27.2% of the students had taken a COVID-19 vaccine. Among those not vaccinated, 42.5% would like to get vaccinated, 21.9% are unsure and the remaining 35.6% would not like to get the vaccine. Astra Zeneca (47.6%) and Johnson & Johnson (53.3%) are the dominating vaccines used. Most of (95.2%) the students stated that they tried to avoid getting infected by the corona virus during the most recent wave of the pandemic. The use of facemasks was considered most important way to avoid getting infected, followed by distancing, handwashing and avoiding crowded places. Few gave priority to avoiding handshakes and avoiding visiting old people and relatives or reduced the number of contact persons. This could be related to the social setup in Malawi, which revolves around handshakes and visiting family members compared to the global north where handshakes are less common.
Muuz Hadush
added a research item
Rural households in Ethiopia suffer from the scarcity of grazing land and water. This article examines the economic impact of time spent looking for water and grazing lands for livestock on crop farming labor and crop output based on a nonseparable farm household model. We estimated a general Cobb-Douglas production function using 518 farmers in Ethiopia. Our results confirm a negative relationship between labor input to crop farming and resource scarcity. On average, a 1% reduction in the time spent looking for water, grazing, and straw led to an increase in food production by 0.16%, 0.28% and 0.33%, respectively.
Stein Terje Holden
added a research item
This study investigates whether and to what extent rainfall shocks recurring in Sub-Saharan Africa, that have been associated with distress land rentals, enhance short-term and medium-term access to rented land by tenant households. Tenant households' rental decisions are modeled in the state-contingent framework with renting-in of land as a risky input choice. Our data is from three rounds of LSMS data from Malawi used to construct a balanced household panel, combined with corresponding district rainfall data that are used to generate seasonal district-wise rainfall shock variables. Panel probit and Tobit models controlling for unobserved heterogeneity were used. Regional heterogeneities were revealed. The results from the Central Region of Malawi, where land rental markets are most active, indicates that the one-year and two-year lagged downside rainfall shocks help tenant households accessing land not only the first year after a rainfall shock but also in the following years. For the more land constrained Southern Region of Malawi, with less prevalence of land rental markets, we observed that the two-year lagged downside rainfall shock is associated with less access to rented land. These results reveal surprising intertemporal and regional variations that are important for policy discussions and lessons on land rental markets amidst recurring rainfall shocks in SSA.
Stein Terje Holden
added a research item
Land is an essential asset for the livelihood and welfare of rural households in agriculture-based rural economies. This study utilizes land registry data from the First and Second Stage Land Registration (FSLR and SSLR) Reforms that took place in 1998 and 2016 in Tigray region of Ethiopia, the first region in Ethiopia to implement land registration and certification. Second Stage Land Registration and Certification (SSLR&C) provided households with parcel-based certificates with names of all holders. We assess the changes in farm sizes and gender distribution of land using mean and median sizes, Gini coefficients, and cumulative distribution graphs. The SSLR data facilitate detailed gender-disaggregated analysis after aggregating parcel data by gender to household level and categorizing households in male- and female-headed households. The data came from 11 municipalities in four districts, covering 78,700 parcels, a total area of about 30,000 ha, allocated to 31,150 households (SSLR). Average farm size declined from 1.15 to 0.90 ha and median farm size from 0.88 to 0.63 ha from 1998 to 2016. The Gini coefficient for land per capita increased from 0.42 in 1998 to 0.57 in 2016. The female landholding share for this land was as high as 48.8% in 2016. Compared to female-headed households, male-headed households had on average 27% and 35% more land per household in 1998 and 2016. The study demonstrates the relevance of land registry data for the monitoring of farm sizes and gender distribution of land and the findings are of relevance for the Sustainable Development Goal 1.4.
Stein Terje Holden
added a research item
We assess the spatial and intertemporal variation in farmland prices using per hectare minimum willingness to accept (WTA) sales and rental (shadow) prices in Malawi. We use three rounds of nationally representative farm household panel data from the Living Standards Measurement Surveys (LSMS), collected in 2010, 2013 and 2016. The sample is split in quintiles based on distance from the nearest major city, building on the land valuation and transaction cost theory, and agrarian political economy perspectives on global and national land transactions. Generally, farmland shadow prices decrease with distance from urban areas. However, farmland shadow sales prices increased more sharply between 2010 and 2013 in rural areas (+100 % vs +30 % in urban proximity). The results indicate that the sharp increase in demand for large-scale land transfers following the sharp increase in energy and food prices also affected rural smallholders' land valuation, even in remote rural areas of Malawi. Conversely, by 2016 land shadow sales prices were again, like in 2010, about three times as high in areas near urban centres compared to remote rural areas. Even though sales prices declined in remote rural areas from 2013 to 2016, rental prices remained high. Using farm household-level population pressure variable, we show that local population pressure is a driver of farmland shadow prices, indicating land scarcity challenges, growing demand for land, and poorly developed land markets. With increasing land scarcity, land markets are becoming more important and need to be factored in when formulating development policies that aim to improve access to land in both peri-urban and rural areas.
Mesfin Tilahun
added an update
Peer reviewed articles
2019
Gebru, M., Holden, S.T., Tilahun, M. (2019). Tenants’ land access in the rental market: evidence from northern Ethiopia. Agricultural Economics 50 (3) 291-302. https://doi.org/10.1111/agec.12484
Hadush, M., Holden, S.T., Tilahun, M. (2019). Does population pressure induce farm intensification? Empirical evidence from Tigrai Region, Ethiopia. Agricultural Economics 50(3) 259–277. https://doi.org/10.1111/agec.12482
Gebrehiwot, D.B. and Holden, S.T. (2019). Variation in Output Shares and Endogenous Matching in Land Rental Contracts: Evidence from Ethiopia. https://onlinelibrary.wiley.com/doi/full/10.1111/1477-9552.12345.
Tesfay, G.B., Abidoye, B. (2019). Shocks in food availability and intra-household resources allocation: evidence on children nutrition outcomes in Ethiopia. Agric Econ 7(3). https://doi.org/10.1186/s40100-019-0120-1
2018
Katengeza, S.P., Holden, S.T., Lunduka, R.W. (2018). Adoption of Drought Tolerant Maize Varieties under Rainfall Stress in Malawi. Journal of Agricultural Economics. https://doi.org/10.1111/1477-9552.12283.
Stein T.Holden, Fisher, M., Katengeza, S.P., Thierfelder, C. (2018). Can lead farmers reveal the adoption potential of conservation agriculture?. The case of Malawi. Land Use Policy, 76 (July): 113-123. https://doi.org/10.1016/j.landusepol.2018.04.048.
Monica Fisher, Stein T. Holden, Christian Thierfelder & Samson P. Katengeza (2018) Awareness and adoption of conservation agriculture in Malawi: what difference can farmer-to-farmer extension make? International Journal of Agricultural Sustainability, 16:3, 310-325. https://doi.org/10.1080/14735903.2018.1472411.
Holden, S.T. and Tilahun, M. (2018). The Importance of Ostrom's Design Principles: Youth Group Performance in Northern Ethiopia. World Development 104, 10-30. https://doi.org/10.1016/j.worlddev.2017.11.010.
Hadush, M. (2018). Impact of improved animal feeding practice on milk production, consumption and animal market participation in Tigrai, Ethiopia. Problems of Agricultural Economics / Zagadnienia Ekonomiki Rolnej 276473, Institute of Agricultural and Food Economics - National Research Institute (IAFE-NRI). https://ideas.repec.org/p/ags/iafepa/276473.html.
Hadush, M. (2018). Understanding Farmers Seasonal And Full Year Stall Feeding Adoption In Northern Ethiopia. Review of Agricultural and Applied Economics (RAAE), Faculty of Economics and Management, Slovak Agricultural University in Nitra, vol. 21(1), March. https://ideas.repec.org/a/ags/roaaec/281187.html
2017
Tilahun, M., Birner, R. and Ilukor, J. (2017). Household-level preferences for mitigation of Prosopis juliflora invasion in the Afar region of Ethiopia: a contingent valuation. Journal of Environmental Planning and Management, 60 (2): 282-308. https://doi.org/10.1080/09640568.2016.1152955.
Hadush, M. (2017). Implication of Animal Feed and Water Scarcity on Labor Allocation, Food Production and Per Capita Food Consumption in Tigrai Region, Ethiopia. Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 42(4), pages 59-93, December. https://ideas.repec.org/a/jed/journl/v42y2017i4p59-93.html.
2016
Tilahun, M., Damnyag, L., Anglaaere, L.C.N. (2016). The Ankasa Forest Conservation Area of Ghana: Ecosystem service values and on-site REDD+ opportunity cost. Journal of Forest Policy and Economics 73: 168-176. https://doi.org/10.1016/j.forpol.2016.08.011.
Tilahun, M., Maertens, M., Deckers, J., Muys, B., Mathijs, E. (2016). Impact of membership in frankincense cooperative firms on rural income and poverty in Tigray, Northern Ethiopia. Journal of Forest Policy and Economics 62: 95-108. https://doi.org/10.1016/j.forpol.2015.08.009
PhD Dissertations
2019
Hadush, M. (2019). The economic implication of animal feed scarcity on food production and consumption: Empirical evidence from Tigrai, Ethiopia. Norwegian University of Life Sciences, School of Economics and Business.
Moges, A. (2019). The Economics of Climate change Adaptation Behaviors of Farm Households in Developing Countries: Field Experiment Evidences. Norwegian University of Life Sciences, School of Economics and Business.
2018
KAPESA, L. (2018). Beekeeping and its impact on livelihoods in Mzenga and Mpamba Extension Planning Areas of Nkhatabay District, Malawi. Lilongwe University of Agriculture and Natural Resources, Malawi.
Katengeza, S.P. (2018). Climate-Smart Agriculture in Malawi: Adoption and Impacts on Farm Household Welfare. Norwegian University of Life Sciences, School of Economics and Business.
2016
Bayray, H. (2016). Four Empirical Essays in Development Economics. Lingnan University, Hong Kong. http://commons.ln.edu.hk/econ_etd/30/
Working papers
2018
Stein T. Holden and Mesfin Tilahun (2018). Land rental as a complementary income source for land-poor youth. CLTS Working Paper No. 6/2018. Centre for Land Tenure Studies, Norwegian University of Life Sciences, Ås, Norway.
Stein T. Holden and Mesfin Tilahun (2018). Gender Differences in Risk Tolerance, Trust and Trustworthiness: Are They Related? CLTS Working Paper No. 3/2018. Centre for Land Tenure Studies, Norwegian University of Life Sciences, Ås, Norway.
Desta Brhanu and Stein T. Holden (2018). Variation in Output Shares and Endogenous Matching in Land Rental Contracts. CLTS Working Paper No. 2/2018. Center for Land Tenure Studies, Norwegian University of Life Sciences, Aas, Norway.
2017
Stein T. Holden and Mesfin Tilahun (2017). Group Trust in Youth Business Groups: Influenced by Risk Tolerance and Expected Trustworthiness. CLTS Working Paper No. 13/2017. Centre for Land Tenure Studies, Norwegian University of Life Sciences, Ås, Norway.
Menasbo Gebru, Stein T. Holden and Mesfin Tilahun (2017). Can the land rental market facilitate smallholder commercialization? Evidence from northern Ethiopia. CLTS Working Paper No. 10/2017. Centre for Land Tenure Studies, Norwegian University of Life Sciences, Ås, Norway.
Stein T. Holden and Mesfin Tilahun (2017). Land Distribution in Northern Ethiopia from 1998 to 2016: Gender-disaggregated, Spatial and Intertemporal Variation. CLTS Working Paper No. 3/2017. Centre for Land Tenure Studies, Norwegian University of Life Sciences, Ås, Norway.
Samson P. Katengeza, Stein T. Holden and Monica Fisher (2017). Adoption of Soil Fertility Management Technologies in Malawi: Impact of Drought Exposure. CLTS Working Paper No. 11/2017. Center for Land Tenure Studies, Norwegian University of Life Sciences, Aas, Norway.
Menasbo Gebru, Stein T. Holden and Mesfin Tilahun (2017). Can the land rental market facilitate smallholder commercialization?. Evidence from northern Ethiopia. CLTS Working Paper No. 10/2017. Center for Land Tenure Studies, Norwegian University of Life Sciences, Aas, Norway.
Girma Berhe Araya and Stein T. Holden (2017). Is Ethiopia's Productive Safety Net Program Enhancing Dependency? CLTS Working Paper No. 5/2017. Center for Land Tenure Studies, Norwegian University of Life Sciences, Aas, Norway.
Samson P. Katengeza, Stein T. Holden and Rodney W. Lunduka (2017). Adoption of Drought Tolerant Maize Varieties under Rainfall Stress in Malawi. CLTS Working Paper No. 4/2017. Center for Land Tenure Studies, Norwegian University of Life Sciences, Aas, Norway.
Stein T. Holden and Mesfin Tilahun (2017). The importance of Ostrom's design principles: Youth group performance in Northern Ethiopia. CLTS Working Paper No. 2/2017. Centre for Land Tenure Studies, Norwegian University of Life Sciences, Ås, Norway.
Monica Fisher, Stein T. Holden, and Samson P. Katengeza (2017). The adoption potential of Conservation Agriculture technologies in Malawi: A lead farmer promoter-adopter approach and assessment. CLTS Working Paper No. 1/2017. Center for Land Tenure Studies, Norwegian University of Life Sciences, Aas, Norway.
2016
Stein T. Holden and Mesfin Tilahun (2016). Youth as Environmental Custodians: A Potential Tragedy or A Sustainable Business and Livelihood Model? CLTS Working Paper No. 6/2016. Centre for Land Tenure Studies, Norwegian University of Life Sciences, Ås, Norway.
Reports
2018
Tilahun, M., Singh, A., Kumar, P., Apindi, E., Schauer, M., Libera, J., Lund H.G. (2018). The Economics of Land Degradation Neutrality in Asia: Empirical Analyses and Policy Implications for the Sustainable Development Goals. Available from www.eld-initiative.org
2016
Holden, S. T., Bezu, S. and Tilahun, M. (2016). How Pro-poor are Land Rental Markets in Ethiopia? CLTS Report No. 1/2016. Centre for Land Tenure Studies, Norwegian University of Life Sciences, Ås, Norway.
Tilahun, M., Mungatana, E., Singh, A., Apindi, E., Barr, J., Zommers, Z., Lund, G., (2015). The Economics of Land Degradation in Africa: Benefits of Action Outweigh the Costs. UNEP-ELD Initiative Report 2015. http://www.eld-initiative.org/index.php?id=111.
Tilahun, M., Barr, J., Apinidi, E., Zommers, Z., Lund, G., & Vuola, A., Mugatana, E., Singh, A., & Kumar, P. (2015). Case Study on: Regional estimates on soil erosion for Africa based on econometric modeling and cost-benefit analysis. In: The Value of Land: Prosperous lands and positive rewards through sustainable land management. ELD Initiative Report 2015. http://www.eld-initiative.org/index.php?id=111.
Sigh A., Barr, J.E., Lund, H.G., Tovivo, K., Tilahun, M., Apindi, E., Giese, K., Nyamihana, C. 2015. Rwanda State of the Environment and Outlook Report 2015. https://www.researchgate.net/publication/304039495_Rwanda_-_State_of_Environment_and_Outlook_Report_2015
Presentations at International Conferences
2019
Kidanemariam Gebretsadik, Eirik Romstad (2019). Irrigation and Demand for Weather Index Insurance: An Application Using Choice Experiments. Association of Environmental and Resource Economists. Manchester, UK. http://www.eaere-conferences.org/index.php?y=2019.
Tesfay, G.B., Abidoye, B. (2019). Women Empowerment in Agriculture and Child Nutrition: Evidence from Ethiopia. African Economic Research Consortium (AERC) conferences: AERC-BMGF conference, Cape Town, South Africa.
Sarah Ephrida Tione, Stein Terje Holden (2019). Growth of cities and urban influence on agricultural land prices in Malawi. 20th World Bank Conference on Land and Poverty, Washington DC, USA. https://www.conftool.com/landandpoverty2019/index.php?page=browseSessions&presentations=show&search=sarah
2018
Tesfay, G.B., Abidoye, B. (2018). Women Empowerment in Agriculture and Child Nutrition: Evidence from Ethiopia. African Economic Research Consortium (AERC) conferences: AERC-biannual research workshop, Nairobi, Kenya.
Tesfay, G.B., Abidoye, B. (2018). Women Empowerment in Agriculture and Child Nutrition: Evidence from Ethiopia. African Economic Research Consortium (AERC) conferences: AERC-BMGF: Agriculture and Food Policy Analysis for Nutrition Workshop in Port Louis, Mauritius.
Desta Birhanu Gebrehiwot and Stein T. Holden (2018). Variation in Output Shares and Endogenous Matching in Land Rental Contracts. 30th International Conference for Agricultural Economics, Vancouver, Canada. https://cslide.ctimeetingtech.com/icae2018/attendee/confcal/presentation/list?q=Desta.
Gebru, Menasbo (2018). Adoption analysis of agricultural technologies in the semi-arid northern Ethiopia: A Panel Data Analysis. 30th International Conference for Agricultural Economics, Vancouver, Canada. https://cslide.ctimeetingtech.com/icae2018/attendee/confcal/presentation/list?q=Menasbo.
Girma Berhe Araya and Stein T. Holden (2018). The Impact of Ethiopia’s Productive Safety Net Program on Fertilizer Adoption by Small Holder Farmers in Tigray, Northern Ethiopia. https://cslide.ctimeetingtech.com/icae2018/attendee/confcal/presentation/list?q=Araya.
Sarah Ephrida Tione, Stein Terje Holden (2018). Transaction costs and land rental market participation in Malawi. 6th African Conference of Agricultural Economists. 23-26 September 2019, Sheraton Hotel, Abuja, Nigeria.
Abrha Megos Meressa, Stale Navrud (2018). Experimenting on Farmer’s Decision-making under Hard Uncertainty: Heuristics, Reward Type and Socioeconomic Determinants. 6th World Congress of Environmental and Resource Economists. Gothenburg, Sweden. http://fleximeets.com/wcere2018/?p=programme.
Tilahun, M., Kumar, P., Singh, A., Mungatana, E., Apindi, E., Schauer, M., Vuola, A., Zommers, Z., Barr, J., Lund, G. 2018. The economics of agricultural land degradation in Africa: a cost benefit analysis. Paper Presented at th 6th World Congress of Environmental and Resource Economists. Gothenburg, Sweden, June 25-29, 2018. http://fleximeets.com/wcere2018/?p=programme#; http://www.wcere2018.org/.
Tilahun, M., Singh, A., Kumar, P., Apindi, E., Schauer, M., Libera, J., Lund H.G. (2018). Master Class Summary on The Economics of Land Degradation Neutrality in Asia: Empirical Analyses and Policy Implications for the SDGs. World Bank Land & Poverty Conference March 23, 2018, Washington DC. https://www.conftool.com/landandpoverty2018/index.php?page=browseSessions&presentations=show&search=Pushpam.
Katengeza, S. (2018). Maize productivity impact of farm input subsidies vis-à-vis climate-smart technologies: A tale of smallholder farmers in Malawi. International Conference on “Sustainable Agricultural and Natural Resource Management under Changing Climate in Sub Saharan Africa (SANCCSSA-Malawi)”.
Katengeza, S.P., Holden, S.T., Kassie, M. (2018). Productivity impact of drought tolerant maize varieties under rainfall stress in Malawi: A continuous treatment approach. Bergen Economics of Energy and Environment Research Conference, Norwegian School of Economics, April 11-12, 2018.
2017
Tilahun M., Kumar P., Singh A., Apindi, E., Lund, H.G., (2017). The Economics of Land Degradation Neutrality in Asia: Empirical Analysis & Policy Implications to SDGs. Results of the ELD Asia Report 2017. Venue: Rio Pavilion, the UNCCD-COP13, Ordos, China, September 11, 2017.
Katengeza, S.P., Holden S.T., Fisher, M. (2017). Use of integrated soil fertility management technologies in Malawi: Impact of dry spells exposure. Research Dissemination Conference for National Commission for Science & Technology, 28th and 29th September, 2017, Sunbird Nkopola Lodge, Mangochi.
Tilahun M. and Holden S.T (2017). How fair is the gendered land distribution? –Evidence from northern Ethiopia. Centre for Land Tenure Studies, Norwegian University of Life Sciences, Aas, Norway. Paper presented at The 16th Nordic Conference in Development Economics, June 12-13, 2017.
Tilahun, M. and Holden, S. (2017). Land Distribution in Northern Ethiopia From 1998 to 2016: Gender-disaggregated, Spatial and Intertemporal Variation. Paper presented at the Annual World Bank Conference on Land and Poverty, March 20-24, 2017, Washington DC.
Holden, S. and Tilahun, M. (2017). The Importance of Ostrom’s Design Principles: Youth Group Performance in Northern Ethiopia. Paper presented at the Annual World Bank Conference on Land and Poverty, March 20-24, 2017, Washington DC.
Bayray, H. (2017). Risk preference differentials of individuals and small groups among poor farmers: Evidence from a lab-in-the-field experiment in rural Ethiopia. Presented at National Conference on Economic Research for Development, Organized by Mekelle University, June 2017.
Abrha Megos Meressa, Stale Navrud (2017).Technology Adoption and Conservation decisions of Farmers under Hard Uncertainty: Experimenting on Fundamental Drivers, Consistency and Determinants of Choices. International Conference on the Ethiopian Economy organized by the collaboration of Ethiopian Economic Association (EEA) and International Food Policy Research Institute (IFPRI) , Addis Ababa, Ethiopia, July 2017.
Abrha Megos Meressa, Stale Navrud (2017).Technology Adoption and Conservation decisions of Farmers under Hard Uncertainty: Experimenting on Fundamental Drivers, Consistency and Determinants of Choices. Nordic Annual Environment and Resource Economics (NAERE) workshop organized by Helsinki University, in Helsinki, Finland, July 2017.
Abrha Megos Meressa, Stale Navrud (2017)Estimating the Economic Value of Riverine Ecosystem Services: Lessons for Mitigating Ecosystem Disservices and Advancing Ecosystem‐based Adaptation on regulated Rivers. European Association of Environmental and Resource Economists (EAERE) organized by Athens University. June 2017. The websites are http://blogs.helsinki.fi/yle-ere/en/naere/ for NAERE; http://www.eaere.org/ for EAERE and http://www.eeaecon.org/
2016
Katengeza, S.P., Hol den S.T., Lunduka, R. (2016).Adoption of Drought Tolerant Maize Varieties under Rainfall Stress in Malawi. Fifth International Conference, September 23-26, 2016, Addis Ababa, Ethiopia. African Association of Agricultural Economists (AAAE). http://www.aaae-africa.org/.
Habtom Bayray (2016). The Medium Term Impacts of Commercial Weather Index Insurance: Evidence from Rural Households in Northern Ethiopia. Presented at Australasian Development Economics Workshop (ADEW), Melbourne, Australia. https://www.deakin.edu.au/__data/assets/pdf_file/0008/724346/ADEW-2016-Program.pdf.
Tilahun, M., Mungatana, E., Singh, A., Apindi, E., Barr, J., Zommers, Z., Lund, G., (2016). THE ECONOMICS OF LAND DEGRADATION IN AFRICA: Benefits of Action Outweigh Costs. Presented at 6th Special Session on African Ministerial Conference on Environment (AMCEN) held in Cairo, April 16-19, 2016.
Tilahun, M., Mungatana, E., Singh, A., Apindi, E., Barr, J., Zommers, Z., Lund, G., (2016). THE ECONOMICS OF AGRICULTURAL LAND DEGRADATION IN AFRICA: Implications of Actions to the SDG’s and Adaptation to Climate Change" NORHED conference on Knowledge for Development in Oslo, June 6-7, 2016.
Tilahun, M., Holden, S.T., Mangisoni, J.H. (2016). NORHED Project on Capacity Building for Climate Smart Natural Resource Management and Policy. Poster presentation at NORHED conference on Knowledge for Development in Oslo, June 6-7, 2016.
 
Stein Terje Holden
added a research item
We use a field experiment to estimate the risk preferences of 945 youth and young adult members of 116 rural business groups organized as primary cooperatives in a semi-arid risky environment in northern Ethiopia. Multiple Choice Lists with binary choices between risky prospects and varying safe amounts are used to identify the certainty equivalent for each risky prospect. Rank Dependent Utility Models with alternatively Wilcox' (2011) Contextual Utility or Busemeyer and Townsend (1992, 1993) Decision Field Theory heteroskedastic error specifications are used to estimate risk preference parameters and parametrized model noise. The study aims to a) assess potential biases associated with Choice List design; b) assess a time-saving elicitation method; c) inspect the predictive power of the predicted risk preference parameters for respondents' investment, income and endowment variables; d) assess how the predictive power is associated with model noise and the addition of two low probability high outcome risky prospects that may help to capture utility curvature more accurately. Substantial risk parameter sensitivity to Choice List design was detected. The rapid elicitation method appears attractive as it facilitates use of a larger number of Choice Lists with variable attributes although it is sensitive to bias due to random error associated with randomized starting points. The addition of the two Choice Lists with low probability high outcomes substantially enhanced the explanatory power of the predicted risk preference parameters and resulted in substantially higher estimates of the utility curvature parameter.
Mesfin Tilahun
added 2 research items
The scarcity of land for crop and livestock production is critical in countries with growing populations. The idea that increasing population density leads to natural resource depletion and economic failure, as predicted by Malthus, or rather to farm intensification, as hypothesized by Boserup, motivates this research. This paper examines how high population pressure in northern Ethiopia influences smallholders’ farm intensification by applying recursive estimation with a control function approach using data from 518 randomly selected farmers. Although our empirical results are more in favor of the Boserupian hypothesis, the findings also reveal that both Malthusian and Boserupian forces co‐exist. Consistent with Malthus theory, high population pressure is found to be associated with small farm size and herd size. Population pressure affected both technology use (breed cow, stall feeding, and modern cattle feed) and output supply (milk yield, milk income, and straw output). As predicted by Boserup's theory, the use of modern input and output supply initially increase with increasing population pressure but decline again when population densities pass a critical threshold (800 persons/km²), supporting Malthus’ hypothesis. The estimation results also revealed that both milk and straw supply responded positively to prices. Free grazing and stall feeding are found to be complementary activities. Likewise, crop farm income and off‐farm job have a non‐linear relation with population pressure, implying that both initially increase and then decrease with rising population pressure. This article is protected by copyright. All rights reserved
The purpose of this study is to investigate the allocation efficiency in the tenancy market, and thereby the potential of the market to facilitate operational farm size adjustment that can help land‐poor tenant households to transform into smallholder commercial farms. We analyzed three rounds of balanced panel data for the production seasons 2005/06, 2009/10, and 2014/15 collected from 320 smallholder farms in Tigrai region in northern Ethiopia. Random effects dynamic probit and tobit models are used to assess how land‐poor tenants’ access and extent of access to land are affected by state dependency (earlier participation in the market), kinship ties, climate shocks, and legal restrictions. The results indicate that state dependency and kinship ties with the landholder had strong positive effects on participation and intensity of participation. Climate shocks significantly affected the intensity of participation of tenants already in the rental market. Tenants’ overall access to rented land had not improved from 2005/06 to 2014/15. The amount of land accessed by those already in the market was insufficient for them to become commercial farmers. The important policy implication is that orchestrated interventions at community level are needed to reduce transaction costs and thereby improve land access of entrepreneurial tenants. This article is protected by copyright. All rights reserved
Stein Terje Holden
added a research item
We assess the spatial and intertemporal change patterns of farmland prices using per hectare minimum willingness to accept (WTA) sales and rental prices in Malawi. We use three rounds of nationally representative household farm panel data from the Living Standards Measurement Surveys (LSMS), collected in 2010, 2013 and 2016. We study price changes by splitting the sample in quintiles based on distance from the nearest major city, building on the von Thünen theory and urban growth model. Generally, WTA land prices decrease with distance from urban areas. However, WTA land sales prices increased more sharply between 2010 and 2013 in rural areas (+100% vs. +30% in urban proximity). Conversely, by 2016 land sales prices were again, like in 2010, about three times as high in areas near urban centres compared to remote rural areas. Even though sales prices declined in remote rural areas from 2013 to 2016, rental prices remained high. Using farm level population pressure, we show that local population pressure is a driver of WTA land prices, which is an indicator of land scarcity challenges and a growing demand for land. Although a policy focus in the past decade within Africa has been on the new demand for large scale land transfers in rural areas, we see that shadow land prices in smallholder agriculture in Malawi were affected by this sharp increase in demand as well as by increasing population pressure and urbanization. With growing land scarcity, land markets are becoming more important and need to be factored in when formulating development policies that aim to improve access to land and land use efficiency in both peri-urban and rural areas.
Stein Terje Holden
added a research item
Integrated soil fertility management (ISFM) technologies hold potential to protect against climate risks, reduce nutrient depletion and enhance food security. In this paper, we study how exposure to dry spells influences use and use intensity of ISFM technologies, specifically focusing on maize-legume intercropping and organic manure. We use a four-round panel dataset collected from households in six Malawi districts over a period of nine years and merged with daily rainfall data from the Department of Climate Change and Meteorological Services. The results using correlated random effects models reveal that exposure to one-year lag of late-season dry spells is associated with high likelihood of use and use intensity of organic manure and maize-legume intercropping. However, there is an inconsistent effect of two-year and three-year lags of both early-season and late-season dry spells on the use and use intensity of both technologies. We respectively attribute these positive and inconsistent impacts to farmers' perceived and delayed benefits of the technologies under dry spells. We recommend that promotion messages should properly package the technologies to include those with immediate and delayed but enduring effects and sensitize the farmers on the same.
Stein Terje Holden
added a research item
The paper investigates the important role of fertilizer to enhance sustainable intensification and food security in Sub-Saharan Africa (SSA) based on a multi-disciplinary literature review. The review starts with a macro-perspective taking population growth, economic development and climate change into account. This is complemented with a micro-perspective summarizing findings from comprehensive micro-data in selected African countries. Agronomic, environmental and economic profitability implications of fertilizer use are reviewed. The poor but efficient hypothesis is assessed in light of recent evidence in behavioral economics. Is low fertilizer use due to hard constraints farmers face or partly due to irrational behavior, and what are the policy implications? Two policy approaches, input subsidy and productive safety net programs, are reviewed and their potential roles to enhance sustainable intensification and nutrient use efficiency in SSA agriculture are discussed before I conclude.
Stein Terje Holden
added a research item
We examine adoption of drought tolerant (DT) maize varieties using a four-round panel dataset from six districts in Malawi. There is an increase in adoption of DT maize from 3% in 2006 to 43% in 2015 in our data. We focus on the effect of past drought exposure on adoption and the likelihood of DT maize being distributed under the Farm Input Subsidy Programme (FISP). Results show that past exposure to drought increases the probability of DT maize seed being distributed through FISP. Farmers who accessed maize seed subsidy coupons and were previously exposed to late season dry spells are more likely to use the seed subsidy coupon to redeem DT maize seed. The likelihood of adoption and adoption intensity (area under DT maize) are positively influenced by previous early season dry spells and access to seed subsidy. Previous late season droughts also positively affect adoption intensity. On the other hand, area share under DT maize is positively correlated with early season dry spells and past exposure to late season dry spells but negatively related to seed subsidy. FISP in Malawi appears to have stimulated adoption of DT maize directly through subsidy and indirectly through generating farmers' experiences of the performance of DT varieties under drought conditions.
Stein Terje Holden
added a research item
Continued high population growth in already densely populated rural areas in parts of Sub-Saharan Africa makes it harder for youth to choose agriculture as their main source of income. We investigate whether near landless youth can still access rented land as a complementary source of income. We utilize a unique data set of rural youth that have been allocated rehabilitated communal land to form formalized business groups for joint business activity. They rely on complementary sources of income and land renting is one of these. Using data from a sample of 1138 youth business group members from 119 youth groups in five districts in the Tigray region of Ethiopia, we find that land renting is a complementary income source for 29% of these youth. It is the most important source of income for 16.8% of the youth and the second most important source of income for 14% of the youth. Access to rented land is constrained, however. Male youth who own oxen and ploughs are much more likely to be able to rent land. Utilizing a trust game to elicit trust and trustworthiness of the youth, we also found a positive association between trust and access to rented land. Trust reduces transaction costs and more trustworthy youth have better access to rented land. The importance of trust is also illustrated by the dominance of kinship contracts and contracts with close neighbors reducing the costs of monitoring tenants. The dominance of sharecropping contracts also contributes to rationing and low allocation efficiency in the market. The prohibition of land sales also limits the potential of the "agricultural ladder" to facilitate youth climbing out of poverty through purchase of land.
Stein Terje Holden
added a research item
We assess the gender difference in mobile phone ownership among youth business group members, and how it affects election into leadership and group board positions in recently established rural youth business groups in northern Ethiopia. Based on data on 1125 youths from 119 youth business groups where 32% of the members were female, 37% of the females and 70% of the males owned mobile phones. Male members were twice as likely to become board members and five times as likely to become group leaders. While there was a strong gender effect, having a mobile phone had an even stronger effect enhancing the likelihood of members becoming board members by 17.4 percentage points. Male gender and mobile phone ownership had equally strong effects on members becoming group leaders. Male group members were on average older than female group members, and with there being a significant age effect, this also contributed to the male dominance in group boards and leadership positions. Education also increased the likelihood of members becoming leaders and board members but this did not increase the gender gap in selection into such positions, as females were equally well educated as males.
Stein Terje Holden
added a research item
Despite the potential of conservation agriculture (CA) for increased crop yields, energy savings, soil erosion control, and water-use efficiency, smallholder farmers in sub-Saharan Africa have been slow to adopt. Farmer-to-farmer extension (F2FE) may have a role to play in overcoming the information access problems and lack of knowledge that may preclude widespread adoption. This study uses data for 180 lead farmers linked to their 455 followers to investigate how F2FE influences awareness and adoption of CA technologies in Malawi. Results from a bivariate probit model for follower farmer awareness and adoption of the three CA principles (minimum soil disturbance, crop residue retention, and crop diversification) reveal four main findings: First, lead farmer motivation increases their effectiveness at diffusing CA practices to their followers. Second, lead farmer familiarity with and adoption of CA both matter to the spread of CA practices, but familiarity appears more important. Third, lead farmers play a more critical role in increasing awareness than adoption of the CA practices. Finally, F2FE is a complement rather than a substitute for other sources of agricultural extension in Malawi’s pluralistic extension system and should support but not replace current systems. Research and policy implications are discussed.
Stein Terje Holden
added a project reference
Stein Terje Holden
added an update
See a popular presentation of our study i Northern Ethiopia here:
 
Stein Terje Holden
added an update
Thanks to a unique combination of collective action, voluntary labour and the involvement of young people, the people of Tigray in northern Ethipia are restoring land on a massive scale. For its remarkable achievements under harsh conditions, Tigray’s policy was recognized with the Future Policy Gold Award 2017, awarded by the World Future Council in partnership with the UNCCD.
A research team from the Norwegian University of Life Sciences & Mekelle University (Stein Holden and Mesfin Tilahun) have contributed to documenting the Award winning land restoration policy. Their census of 740 youth groups in five districts in Tigray was an important reference in identifying the winner of the Award (Holden and Tilahun 2017). They concluded that there is a high degree of compliance with Elinor Ostrom’s Design Principles across the youth groups, and that the youth group model shows promise as an approach for engaging landless and unemployed youth in productive activities and as environmental custodians. Ultimately, they recommend that it should be tested in other countries.
The paper on winning land restortion policy with the title "THE IMPORTANCE OF OSTROM’S DESIGN PRINCIPLES: Youth Group Performance in Northern Ethiopia" was presented by Stein Holden (co-authored with Mesfin Tilahun) at the Annual World Bank Conference on Land and Poverty in Washington, DC, in March 2017. This paper is as CLTS Working paper with the title " The importance of Ostrom's design principles: Youth group performance in Northern Ethiopia" written by Stein T. Holden and Mesfin Tilahun.
The World Bank, which has contributed to the land restoration through its Sustainable Land Management Project, points out that the project “is reducing youth unemployment, and incentivizing good land stewardship among the next generation of community leaders, while boosting the climate resilience and carbon storage potential of production landscapes by bringing land back into production”.
Tigray’s approach provides an integrated landscape management model for the restoration of sub-Saharan African drylands. Its evolution from top-down, centralised programmes to more bottom-up, decentralised, and participatory programmes shows how a stepwise or sequential series of steps can help garner local and international support and scale up sustainable land management interventions. The effective mobilisation of local farmers was a key success factor and is a cost-effective way to enhance welfare and sustainable land management.
The NMBU/MU research team continues its research on the performance of youth groups consisting of youth who were landless and unemployed and that have been allocated rehabilitated communal lands. They are required to conserve these lands while they at the same time have established a joint business on this land (such as forestry, irrigation, horticulture, animal rearing, beekeeping). More information can be obtained here:
 
Stein Terje Holden
added 4 research items
Is low input use by poor, smallholder farmers caused by time-inconsistent behavior or by limited ability to buy inputs? Are input subsidies the best solution to stimulate input demand or are there smarter solutions? These issues are investigated by combining survey data, stated preference questions , and randomized experiments in Malawi. The demand for fertilizer at harvest time and at planting time, farm gate shadow prices for fertilizer, and the gap between the willingness-to-accept (WTA) and willingness-to-pay (WTP) prices for a standard input package were investigated. Significant effects of timing and of cash constraints were found, suggesting the possibility that smarter designs exist, such as distribution of smaller packages from harvest time to planting time.
This study uses simple non-separable farm household models calibrated to household, market, farming and policy context conditions in Central and Southern Malawi. The models are used to simulate how household characteristics, design and access to input subsidies affect the demand for improved maize seeds; how increasing land scarcity affects the cropping system and demand for improved maize; and how access to improved maize seeds affects household welfare with varying access to input subsidies. The model simulations demonstrate that a) there is a high risk that access to subsidized improved maize seeds can crowd out commercial demand for improved maize seeds but the effect is very sensitive to household characteristics, market characteristics and relative prices; b) increasing land scarcity increases the demand for improved maize seeds and improved maize facilitates intensification among others through intercropping of maize with legumes such as beans and pigeon peas; c) the welfare effects depend on households' ability to utilize the potential of the improved varieties by combining them with complementary inputs.
After six years with a large scale Farm Input Subsidy Program that enhanced national and household food security high costs resulted in a cut-back of the program in 2011/12 at the same time as the country was hit by a more serious drought in form of a dry spell in the rainy season. This study used household and farm plot level data combined with choice experiments to assess the impacts of the cut-back of the program and the drought on maize production and the performance of different maize varieties. The demand for improved maize seeds and adoption constraints were investigated and so was the knowledge and use of conservation technologies that in recent years have been introduced by a national level extension program. One of the effects of the cut-back is that the standard package is split and shared by two or more households. The drought resulted in a reduction in maize yields of 400 kg/ha. Many of the most commonly used hybrid maize varieties performed significantly better than local maize with yields about 600 kg/ha higher than local maize. About 4.3% of the maize plots were planted with the new ZM523 drought tolerant maize variety but it did not perform better than the hybrid maize varieties and has not yet become one of the popular varieties that are in high demand. About 35% of the households stated that they failed to obtain the most preferred maize variety and these were among the most commonly grown varieties, showing that there is scope for increased adoption of such varieties. Cash constraints and high prices for improved maize and fertilizer are limiting adoption, however, and continue to be a challenge for sustainable intensification of the maize-based production system. Newly introduced conservation technologies appear promising as one way to reduce the vulnerability to drought and enhance the fertilizer use efficiency.
Stein Terje Holden
added a research item
This paper draws on recent developments in the theory of choice under uncertainty to model anomalies in intertemporal choice. Cognitive limitations leading to hyperbolic discounting and magnitude effects in intertemporal choice may be described in terms of bounded awareness, and represented by phenomena familiar from visualization software such as Google Earth. Cognitive limits on visualization impose constraints on both the area being viewed and the level of detail of the view, with a trade-off between the two. Increasing detail at the expense of limiting the area viewed may be described as zooming. Data from a field experiment were used to assess the theory with an incentive-compatible multiple price list approach involving magnitude levels of 5x, 10x and 20x the basic magnitude level with time horizons of one, three, six and 12 months. Without zooming adjustments in base consumption, very strong hyperbolic and magnitude effects were found, and present bias could not explain the hyperbolic effects. The zooming model provides an explanation of what appear to be significant intertemporal anomalies in the data.
Stein Terje Holden
added 2 research items
We used a field experiment to investigate exchange asymmetries in productive assets among poor rural respondents in Ethiopia. Farmers were randomly allocated two types of productive assets or cash, with a choice to keep the productive asset (cash) or exchange it for cash (productive asset). To introduce productive asset variation, a durable asset (farm tool) and a short-term input (fertilizer) were randomly allocated and combined with a random amount of cash. Loss aversion was proxied with a separate experiment and was used to assess the importance of endowment effect theory to explain exchange asymmetries. A greater exchange asymmetry was found for the more popular tool than for fertilizer. Loss aversion could explain a small but significant part of the exchange asymmetry in tools, but experience did not reduce the exchange asymmetry. Compared to the female respondents, the male respondents exhibited greater exchange asymmetries and more non-linear price responses with declining elasticities as prices increased.
I present a theory that can explain hyperbolic discounting and magnitude effects in intertemporal choice. This approach builds on theories of narrow framing and reference dependence and expands these theories in a novel way by examining hidden mental zooming in base consumption adjustment in decisions regarding intertemporal prospects of varying magnitudes and time horizons. Data from a field experiment were used to assess the theory with an incentivecompatible multiple price list approach involving magnitude levels of 5x, 10x and 20x the basic magnitude level with time horizons of one, three, six and 12 months. Without zooming adjustments in base consumption, very strong hyperbolic and magnitude effects were found, and present bias could not explain the hyperbolic effects. The mental zooming model provides an effective rational explanation of what appear to be significant intertemporal anomalies in the data.
Stein Terje Holden
added 2 research items
We used a field experiment to investigate exchange asymmetries in productive assets among poor rural respondents in Ethiopia. Farmers were randomly allocated two types of productive assets or cash, with a choice to keep the productive asset (cash) or exchange it for cash (productive asset). To introduce productive asset variation, a durable asset (farm tool) and a short-term input (fertilizer) were randomly allocated and combined with a random amount of cash. Loss aversion was proxied with a separate experiment and was used to assess the importance of endowment effect theory to explain exchange asymmetries. A greater exchange asymmetry was found for the more popular tool than for fertilizer. Loss aversion could explain a small but significant part of the exchange asymmetry in tools, but experience did not reduce the exchange asymmetry. Compared to the female respondents, the male respondents exhibited greater exchange asymmetries and more non-linear price responses with declining elasticities as prices increased.
We used a field experiment to investigate exchange asymmetries in productive assets among poor rural respondents in Ethiopia. Farmers were randomly allocated two types of productive assets or cash, with a choice to keep the productive asset (cash) or exchange it for cash (productive asset). To introduce productive asset variation, a durable asset (farm tool) and a short-term input (fertilizer) were randomly allocated and combined with a random amount of cash. Loss aversion was proxied with a separate experiment and was used to assess the importance of endowment effect theory to explain exchange asymmetries. A greater exchange asymmetry was found for the more popular tool than for fertilizer. Loss aversion could explain a small but significant part of the exchange asymmetry in tools, but experience did not reduce the exchange asymmetry. Compared to the female respondents, the male respondents exhibited greater exchange asymmetries and more non-linear price responses with declining elasticities as prices increased.
Stein Terje Holden
added a research item
This study used a three-year panel dataset for 350 Malawian farm households to examine the potential for widespread adoption of drought tolerant (DT) maize varieties, a technology that holds considerable promise for helping smallholder farmers in SSA adapt to drought risk. Regression results revealed that DT maize cultivation increased substantially from 2006 to 2012, with the main driver being the Malawi Farm Input Subsidy Program. Some other key factors related to adoption were having recently experienced drought and farmer risk aversion. As far as yield performance, improved maize varieties performed significantly better than local maize during the 2011/12 drought year. However, DT maize did not perform significantly better than other improved maize varieties used in Malawi, which is in contradiction to results from on-station and on-farm trials (e.g., Magorokosho et al. 2010; Setimela et al., 2012). A plausible explanation is that farmers had inadequate training or experience to move towards the yield potentials of the DT maize varieties. Expansion of agricultural extension activities may be required to help farmers achieve the DT maize yield potentials and, subsequently, improve farmer resilience to drought.
Stein Terje Holden
added 3 research items
This article reviews the past and potential future roles of land tenure reforms and land markets in Sub-Saharan Africa (SSA) as responses to population growth in the process of land use intensification and livelihood transformation. The farm size distribution and the existence of an inverse relationship (IR) between farm size and land productivity in SSA and the implications of this relationship for efficiency and equity are investigated. More secure property rights and removal of restrictions on land markets have the potential to create both efficiency and equity benefits, but there are high risks of elite capture of large land areas with inefficient and inequitable outcomes. This situation is the case not only in land-abundant areas but also in urban and peri-urban areas where increasingly larger proportions of people will make their living. Increasing population pressure in densely populated rural areas contributes to more rapid rural–urban migration, and creating alternative livelihood opportunities for the migrating youth population is essential to achieving economic development with social stability.
Stein Terje Holden
added 3 research items
This study used a three-year panel dataset for 350 Malawian farm households to examine the potential for widespread adoption of drought tolerant (DT) maize varieties, a technology that holds considerable promise for helping smallholder farmers in SSA adapt to drought risk. Regression results revealed that DT maize cultivation increased substantially from 2006 to 2012, with the main driver being the Malawi Farm Input Subsidy Program. Some other key factors related to adoption were having recently experienced drought and farmer risk aversion. As far as yield performance, improved maize varieties performed significantly better than local maize during the 2011/12 drought year. However, DT maize did not perform significantly better than other improved maize varieties used in Malawi, which is in contradiction to results from on-station and on-farm trials (e.g., Magorokosho et al. 2010; Setimela et al., 2012). A plausible explanation is that farmers had inadequate training or experience to move towards the yield potentials of the DT maize varieties. Expansion of agricultural extension activities may be required to help farmers achieve the DT maize yield potentials and, subsequently, improve farmer resilience to drought.
We make cross-sectional comparisons of productivity in a risky agricultural setting. To make meaningful comparisons, we find it necessary to define a new productivity index that satisfies important axioms from index number theory (e.g., transitivity). The index can be computed without any information on output or input prices. However, it cannot be computed without an estimate of a state-contingent production frontier. We use maximum likelihood methods to estimate a state-contingent stochastic production frontier that explicitly allows for variations in input quality. We find that differences in productivity are mainly due to differences in environment and scale-mix efficiency. In turn, we conjecture that differences in scale-mix efficiency are partly driven by variations in access to input subsidies. The maximum likelihood estimator appears to do a poor job of disentangling the effects of technical inefficiency and statistical noise
Climate risk represents an increasing threat to poor and vulnerable farmers in drought-prone areas of Africa. This study assesses the maize and fertilizer adoption responses of food insecure farmers in Malawi, where Drought Tolerant (DT) maize was recently introduced. A field experiment, eliciting relative risk aversion, loss aversion and subjective probability weighting parameters of farmers, is combined with a detailed farm household survey that measured the intensity of adoption of different maize types and fertilizer use on the different maize types and recorded exposure to past and present drought and other shocks. More risk averse households were more likely to have adopted DT maize, less likely to have adopted other improved maize varieties and less likely to have dis-adopted traditional local maize. Exposure to past drought shocks stimulated adoption of DT maize and dis-adoption of local maize. Over-weighting of small probabilities was associated with less use of fertilizer on all maize types.
Stein Terje Holden
added 2 research items
Climate risk represents an increasing threat to poor and vulnerable farmers in drought-prone areas of Africa. This study assesses the maize and fertilizer adoption responses of food insecure farmers in Malawi, where Drought Tolerant (DT) maize was recently introduced. A field experiment, eliciting relative risk aversion, loss aversion and subjective probability weighting parameters of farmers, is combined with a detailed farm household survey. A state-contingent production model with cumulative prospect theory preferences is estimated. More risk averse households were more likely to have adopted DT maize, less likely to have adopted other improved maize varieties and less likely to have dis-adopted traditional local maize. Exposure to past drought shocks stimulated adoption of DT maize and dis-adoption of local maize. Over-weighting of small probabilities was associated with less use of fertilizer on all maize types.
This paper draws on recent developments in the theory of choice under uncertainty to model anomalies in intertemporal choice. Cognitive limitations leading to hyperbolic discounting and magnitude effects in intertemporal choice may be described in terms of bounded awareness, and represented by phenomena familiar from visualization software such as Google Earth. Cognitive limits on visualization impose constraints on both the area being viewed and the level of detail of the view, with a trade-off between the two. Increasing detail at the expense of limiting the area viewed may be described as zooming. Data from a field experiment were used to assess the theory with an incentive-compatible multiple price list approach involving magnitude levels of 5x, 10x and 20x the basic magnitude level with time horizons of one, three, six and 12 months. Without zooming adjustments in base consumption, very strong hyperbolic and magnitude effects were found, and present bias could not explain the hyperbolic effects. The zooming model provides an explanation of what appear to be significant intertemporal anomalies in the data.
Stein Terje Holden
added a research item
This study used a three-year panel dataset for 350 Malawian farm households to examine the potential for widespread adoption of drought tolerant (DT) maize varieties, a technology that holds considerable promise for helping smallholder farmers in Sub-Saharan Africa (SSA) adapt to drought risk. Regression results revealed that DT maize cultivation increased substantially from 2006 to 2012, with the main driver being the Malawi Farm Input Subsidy Program. Recently experienced drought and farmer risk aversion stimulated adoption of DT maize. In yield performance, improved maize varieties performed significantly better than local maize during the 2011/12 drought year. However, DT maize did not perform significantly better than other improved maize varieties used in Malawi, which is in contradiction to results obtained from on-station and on-farm trials. A plausible explanation is that the severe drought in Malawi in the 2011/12 season occurred early in the rainy season and DT maize primarily provides an advantage in the case of late droughts during the silking/grain filling stage of the crop. Preliminary results herein suggest that it was lack of rainfall in December 2011 that constrained maize yield while rainfall in January and February was less limiting. Additionally, the length of the longest dry spells in December and February further strengthens the evidence in favor of this explanation, but further research is needed to reach a conclusion.
Stein Terje Holden
added a research item
Increasing agricultural productivity among smallholders in developing countries remains essential to improving food security, and one potential avenue for this increase is through stimulating technology adoption. In this paper we combine rainfall data with household survey and field experimental data to assess households' use and potential demand for a risky agricultural input in Tigray, Ethiopia. More specifically, we explore how average rainfall, rainfall variability, lagged rainfall shocks and risk aversion relate to inorganic fertiliser use at the farm plot level. Further, we analyse how these variables and exogenous price variation affect the demand for inorganic fertiliser at the household level. The findings are potentially important for the design of policies to promote agricultural production in semi-arid rain-fed agricultural areas with vulnerable populations facing rainfall risk and shocks.
Mesfin Tilahun
added an update
Mesfin Tilahun
added a project goal
Ethiopia and Malawi have been implementing a number of development interventions to address development challenges like natural resource degradation, food insecurity, poverty, and adaptation and mitigation of climate change impacts. The two countries are among the sub-Saharan African (SSA) countries with a number of common development challenges ahead as implied by their low level of development indicators.
In this regard, it is very crucial to search for policy options that could create win-win situations whereby viable options can lead to more growth, less poverty and improved and sustainable management of natural resources. These require scholarly capacity in the area of the economics of climate smart natural resource management and policy analysis in the two south partner countries (Ethiopia and Malawi). In particular, such expertise at the higher education institutions has a paramount importance to undertake advanced and innovative research and research based education, and to increase knowledge and its use for policy decision making. However, there is lack of technical capacity at individual and at higher education institutions of the two countries. Thus, based on the above background the NORHED-CLISNARP project has been designed as a collaborative research and capacity-building project by three partner universities (Mekelle University, Lilongwe University of Agriculture and Natural Resources, and Norwegian University of Life Sciences).
The goal of the project is strengthening education and research capacity in economics of climate smart agriculture, natural resource management, and policy at MU and LUANAR in partnership with NMBU.
Project budget: 18 Million NOK
Funding Organization: Norwegian Agency for Development Cooperation (NORAD)
Project duration: Five years (January 2013 – December 2018)
Major Components: Full scholarships for 15 PhDs and 20 M.Sc., a postdoctoral fellowship and institutional development.
Partners Institutions: Mekelle University, Department of Economics (Ethiopia), Lilongwe University of Agriculture and Natural Resources (Malawi), Norwegian University of Life Sciences, School of Economics and Business (Norway)