Input Subsidies, Household Welfare, and Sustainable Land Use

This blog focuses on our recent research in Malawi on the Input Subsidy Program and Its Impacts. We have collected detailed panel data from farm households in 6 districts in central and southern Malawi in 2006, 2007 and 2009 and use these in our analyses. The research was funded by NORAD and the Norwegian Embassy in Malawi and data were collected by a group of students in our Master Program in Development and Natural Resource Economics

Has the input subsidy program lead to more mono-cropping of maize at the expense of other crops?

Field work in MalawiPosted by Stein Holden Sun, September 05, 2010 20:22:11
The assessment of crop choice at farm plot level revealed that 70% of the plots were allocated to maize in 2006 against 57% of the plots in 2009. Maize plots were, however, on average larger than the plots of all other crop categories. The number of plots under tobacco and sugarcane increased from 2006 to 2009. This may be associated with the introduction of subsidies for fertilizer for tobacco which partly also contributed to the overproduction of tobacco in 2008/09. There was also a positive trend in the percentage of the plots planted with legumes as the main crop, from 13% in 2006 to 17% in 2009.

Maize was found to be a more dominant crop on smaller farms. The average maize area was 0.71 ha/farm and the average farm size was 1.17 ha. An increase in the farm area of 1ha was associated with an increase in the maize area of 0.48 ha. Labor- and livestock-rich households have significantly larger maize areas. The maize area has reduced significantly from 2006 to 2009 showing that maize production is intensified as fertilizer use has increased in the same period. The result of increased input access and use is therefore area intensification rather than area expansion. This may imply that the subsidy program also facilitates production of other crops by releasing maize areas.

The mean maize area share out of total farm size is 0.68, varying from 0.80 in Thyolo to 0.57 in Kasungu and Machinga districts. The maize area share has decreased from 0.73 in 2006 to 0.64 in 2009. The land-poor have larger maize area shares while the livestock-poor have smaller maize area shares.

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