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The impact of shadow prices and farmers' impatience on the allocation of a multipurpose renewable resource in Ethiopia

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  • Teklewold, Hailemariam

Abstract

In a mixed farming system in which farmyard manure (FYM) is considered an important multipurpose renewable resource that can be used to enhance soil organic matter, provide additional income and supply household energy, soil fertility depletion could take place within the perspective of the household allocation pattern of FYM. This paper estimates a system of FYM allocation regressions to examine the role of returns to FYM and farmers' impatience on the propensity to allocate FYM to different uses. We parameterize the model using data from a sample of 493 households in Ethiopia. Results indicate a heightened incentive for diverting FYM from farming to marketing for burning outside the household when returns to selling FYM and the farmer's discount rate are high. These reveal the need for policies that will help to reduce farmers' impatience and encourage the substitution of alternative energy sources to increase the use of FYM as a sustainable land management practice.

Suggested Citation

  • Teklewold, Hailemariam, 2012. "The impact of shadow prices and farmers' impatience on the allocation of a multipurpose renewable resource in Ethiopia," Environment and Development Economics, Cambridge University Press, vol. 17(4), pages 479-505, August.
    • Handle: RePEc:cup:endeec:v:17:y:2012:i:04:p:479-505_00
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    Cited by:

    1. Tas Thamo & David J. Pannell & Marit E. Kragt & Michael J. Robertson & Maksym Polyakov, 2017. "Dynamics and the economics of carbon sequestration: common oversights and their implications," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 22(7), pages 1095-1111, October.
    2. Olson, Kent & Gauto, Victor & Erenstein, Olaf & Teufel, Nils & Swain, Braja & Tui, Sabine Homann-Kee & Duncan, Alan, 2021. "Estimating Farmers’ Internal Value of Crop Residues in Smallholder Crop-Livestock Systems: A South Asia Case Study," 2021 Conference, August 17-31, 2021, Virtual 315188, International Association of Agricultural Economists.
    3. Berazneva, Julia & Lee, David R. & Place, Frank & Jakubson, George, 2018. "Allocation and Valuation of Smallholder Maize Residues in Western Kenya," Ecological Economics, Elsevier, vol. 152(C), pages 172-182.

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