Understanding Farmers’ Technology Adoption Decisions: Input Complementarity and Heterogeneity
"The objective of this paper is to investigate farmers’ multidimensional technology adoption decisions in the presence of heterogeneities across households. We aim to quantify potential complementarities among inputs and alternative forms of unobserved heterogeneities among households. Quantifying complementarities among alternative inputs is crucial because these effects are potentially correlated with some other observable and unobservable factors that affect households’ adoption decisions. From a policy perspective, quantifying these complementarities while controlling for potential unobserved heterogeneities can provide some input to designing effective technology diffusion strategies. We focus on three agricultural inputs in Ethiopia – chemical fertilizers, improved seeds, and extension services."