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Abstract

Efforts to increase agricultural productivity in sub-Saharan Africa require innovative approaches to improve smallholder access to new technologies. One increasingly popular approach is the use of market segmentation schemes to target smallholders with subsidized inputs. This paper presents results from an evaluation of the impact of a discount voucher scheme designed to encourage the purchase of improved maize seed by smallholders in two districts in Kenya. The study uses a randomized experiment to rigorously establish the counterfactual, i.e., ―what would have happened in the absence of the scheme?‖ Findings suggest that while the scheme generated a significant displacement effect, higher discounts on the price of seed did have a positive impact on seed purchases. The findings are relevant to government and corporate decision-makers interested in disseminating genetically modified crops to smallholders in sub-Saharan Africa through the use of discount vouchers tied to humanitarian use exemptions and royalty-free licenses.

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