Working Paper | HBS Working Paper Series | 2016

‘Mobile’izing Agricultural Advice: Technology Adoption, Diffusion and Sustainability

by Shawn A. Cole and A. Nilesh Fernando

Abstract

Attempts to explain dramatic differences in agricultural productivity around the world typically focus on farm size, risk aversion, and credit constraints, with an emphasis on how they might serve to limit technology adoption. This paper takes a different tack: can managerial practices explain this variation in productivity? A randomized evaluation of a mobile phone-based agricultural consulting service, Avaaj Otalo (AO), to farmers in Gujarat, India, reveals the following. Demand for agricultural advice is substantial and farmers offered the service turn less often to traditional sources of agricultural advice. Management practices change as well: farmers invest more in recommended agricultural inputs, resulting in dramatic increases in average yield for cumin (28.0%), as well as improvements in cotton yield (8.6%) for a sub-group that received frequent reminders to use the service. Our design allows us to estimate peer effects, and we find treated farmers with more treated peers are more likely to change their cropping decisions and successfully address pest shocks. The value of the latter externality is more than twice the cost of the subsidy that would be necessary to operate the service. We estimate that each dollar spent on providing the service yields a private return of $10. These findings highlight the importance of managerial practices in facilitating technology adoption in agriculture.

Keywords: technology adoption; agricultural extension; informational inefficiencies; Management Practices and Processes; Performance Productivity; Agribusiness; Mobile Technology; Agriculture and Agribusiness Industry; Gujarat;

Citation:

Cole, Shawn A., and A. Nilesh Fernando. "‘Mobile’izing Agricultural Advice: Technology Adoption, Diffusion and Sustainability." Harvard Business School Working Paper, No. 13-047, November 2012. (Revised March 2016.)