A Farm Household Analysis of Technological Change and Structural Adjustment Policies in the Peanut Basin of Senegal

Mamadou Sidibe, Purdue University

Abstract

The loss in soil fertility has been considered as one of the most fundamental causes of declining agricultural productivity in Senegal. Recently, the Government has invested in agricultural technology research emphasizing soil fertility restoration programs. This thesis looked at the potential benefits of these technologies on farmers' welfare in the Peanut Basin. Six principal conclusions emerged from the results obtained through representative farm models in the Peanut Basin. First, specifying and quantifying the principal sources of risk was more helpful in understanding farmers' behavior and the identification of policy options than the standard utility maximization model. Second, there was no price penalty for obtaining farmers' post harvest income goal because of their ability to sell peanuts at a guaranteed price. However, at higher income goals, it was necessary to sell cereals and a price penalty was incurred to the household. Third, both farming systems in the Peanut Basin benefit from technology introduction especially in the central part of the region. Given the nutrient depletion level of these soil, the phosphate (P) restoration technology combined with manure and nitrogen (N) is the recommended module for both millet and peanuts. The expansion of input use is financially profitable at the farm level and is directly constrained by the available liquidity. Over time, with increased liquidity and farm profits, farmers can shift to higher degrees of intensification by using more inorganic fertilizer. Fourth, in response to the expected benefits of the structural adjustment policies, the representative farm's profit responded positively to an increased demand for millet, maize and cowpeas, especially in the Central Peanut Basin. Nevertheless, peanuts will continue to play a leading role in household farm income formation in the Peanut Basin. Fifth, government price distortions from tariff and taxes have limited fertilizer demand and technology adoption in both zones of the Peanut Basin. Removing these distortions will be beneficial to farmers potential adoption of new technologies. Last, deregulating the cowpea input market coupled with increasing demand for cowpeas, will potentially accelerate the adoption of more intensive cowpea technologies in the Central Peanut Basin.

Degree

Ph.D.

Advisors

Sanders, Purdue University.

Subject Area

Agricultural economics|Soil sciences|Public administration|Sustainability

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