@article{Ricker-Gilbert:51606,
      recid = {51606},
      author = {Ricker-Gilbert, Jacob and Jayne, Thomas S.},
      title = {Do Fertilizer Subsidies Affect the Demand for Commercial  Fertilizer? An Example from Malawi},
      address = {2009},
      number = {1005-2016-79184},
      series = {Contributed Paper},
      pages = {43},
      year = {2009},
      note = {Replaced with revised version of paper 07/24/09.},
      abstract = {Fertilizer subsidies are again becoming a popular policy  tool in sub-Saharan Africa.  Despite their potential,  little empirical research has been undertaken on how  subsidies affect a farmer’s decision to purchase commercial  fertilizer.  Because of this, there is a dearth of  information on how fertilizer subsidy programs affect total  fertilizer and commercial fertilizer use.  This paper uses  a double hurdle model with panel data from Malawi to answer  these questions.  It also uses a control function approach  to deal with endogeneity of subsidized fertilizer in a  commercial fertilizer demand equation.  Our results  indicate that subsidized fertilizer negatively impacts  participation in commercial markets.  Once the  participation decision has been made however, demand for  commercial fertilizer is driven by farm size, assets and  fertilizer price and maize price rather than by whether a  farmer received subsidized fertilizer.  We calculate the  average partial effects of subsidized fertilizer and find  that on average, receiving one additional kilogram of  subsidized fertilizer causes a farmer to purchase 0.20  fewer kilograms of commercial fertilizer.  This indicates  that fertilizer subsidies may adversely affect the demand  for commercial fertilizer and also raise total fertilizer  use by a somewhat smaller quantity than the quantity of  fertilizer distributed through the subsidy program.},
      url = {http://ageconsearch.umn.edu/record/51606},
      doi = {https://doi.org/10.22004/ag.econ.51606},
}