Determinants of precision technology adoption by farm input suppliers
Abstract
The objective of this study was to determine the relative importance of five drivers of adoption for 15 different precision agricultural services offered by farm input suppliers. These drivers included: expected benefits, firm resources, strategic fit, technology complexity/uncertainty and market conditions. To test these hypotheses, 357 Midwestern farm input suppliers were interviewed by phone and asked questions about precision technology, firm and customer characteristics, and general market conditions. Firms were also asked whether or not they offered each of 15 different precision services. Adoption of precision services was measured by the firm's adoption status of the 15 individual precision technology service offerings. Adoption was first explored by looking at the drivers impacting adoption of individual precision service offerings using logit models. Exploratory factor analysis was then used to identify bundles of precision technology services. Four primary bundles were identified: a basic precision bundle, a manual variable rate application bundle, a single nutrient controller-driven application bundle (liquid nutrients and pesticides), and a multi-nutrient controller-driven application bundle. The results suggested yield monitor sales/rental and satellite imagery were not part of any of the bundles. Firms were then categorized by their adoption level of each bundle: no adoption, partial adoption or complete adoption. These adoptions categories were then explored for each bundle using multinomial logit models to determine which drivers were motivating adoption. Those farm input suppliers who were facing strong competitive pressure, had developed their own long-term strategy, and had significant firm-level resources were most likely to adopt a complete basic precision bundle. Cooperatives were especially likely to offer a full service precision package. Firms who did not have a focused long-term strategy and who were more uncertain about the technology but who did perceive some benefits for precision technology tended to adopt components of the bundle. This implies manufacturers of precision components need to be aware of the competition level in the local market, firm-level strategy and organizational structure as they market their equipment to farm input suppliers.
Degree
Ph.D.
Advisors
Akridge, Purdue University.
Subject Area
Agricultural economics|Business costs
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