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Joint Estimation of Technology Adoption and Land Allocation with Implications for the Design of Conservation Policy

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  • Georgina Moreno
  • David L. Sunding

Abstract

One challenge to estimating the parameters of a technology adoption model is that technology is selected jointly with land allocation. The article estimates a nested logit model of technology and crop choices that accounts for unobserved correlation among decisions. Estimation is conducted with a data set of adoptions, in contrast to the more common approach of using cross-section observations of existing technologies. Estimation results support the choice of a nesting structure as opposed to a more standard multinomial logit model. Adoption of precision irrigation technology is shown to be more sensitive to financial incentives affecting input price and technology cost than suggested by previous studies. Copyright 2005, Oxford University Press.

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  • Georgina Moreno & David L. Sunding, 2005. "Joint Estimation of Technology Adoption and Land Allocation with Implications for the Design of Conservation Policy," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(4), pages 1009-1019.
    • Handle: RePEc:oup:ajagec:v:87:y:2005:i:4:p:1009-1019
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    File URL: http://hdl.handle.net/10.1111/j.1467-8276.2005.00784.x
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