Estimating the Interlink between Agricultural Production Decisions: A Case of Maize Farming Households in Nigeria

The problem of market failure in developing economies forces farmers to use production inputs way below their optimal levels. It can also spur them to explore multiple production strategies as a hedge against poor yield. This study utilized multivariate analysis to investigate the synergies and/or tradeoffs of sustainable production decisions among maize farming households in Nigeria. Using a nationally representative dataset, the Multivariate Probit model employed for the analysis comprised a system of three simultaneous equations modelling the factors that influence the joint decisions to use certified maize seeds, agrochemicals and conserve crop biodiversity. Our findings suggest that farming households’ decisions related to these production strategies are significantly interlinked and strong complementarities exist among them. Household size and non-farm asset ownership have the strongest influence on the probability of jointly implementing the trio production strategies. Thus, highlighting the importance of endowment effects (human capital and economic resources) in strategic decision-making among farm-families. These findings have important policy implications because they suggest that the enactment of policies promoting the use of any of these production strategies among smallholder farmers can have spillover effects on the use of others. Hence, culminating in the emergence of a more resilient food production system.