Weather risk is a serious issue in the African small farm sector that will further increase due to climate change. Farmers typically react by using low amounts of agricultural inputs. Low input use can help to minimize financial loss in bad years, but is also associated with low average yield and income. Increasing small farm productivity and income is an important prerequisite for rural poverty reduction and food security. Crop insurance could incentivize farmers to increase their input use, but indemnity-based crop insurance programs are plagued by market failures. This article contributes to the emerging literature on the role of weather index insurance (WII). We use data from a survey of farmers in Kenya, where a commercial WII scheme has been operating for several years. Regression models with instrumental variables are used to analyze WII uptake and effects on input use and crop productivity. Results show that WII uptake is positively and significantly associated with the use of chemical fertilizer and improved seeds, and also with crop yield. We conclude that upscaling WII programs may help to spur agricultural development in the small farm sector.
Background
Smallholder farmers in developing countries are particularly vulnerable to climate shocks but often lack access to agricultural insurance. Weather index insurance (WII) could reduce some of the problems associated with traditional, indemnity-based insurance programs, but uptake has been lower...
This paper analyses a biotechnology-focused project which aims to promote the development and adoption of tissue culture bananas by small-scale farmers in Kenya. The paper highlights the generation of several important narratives that are used to justify the development and...
Supermarkets and high-value exports are currently gaining ground in the agri-food systems of many developing countries. While recent research has analyzed income effects in the small farm sector, impacts on farming efficiency have hardly been studied. Using a survey of...
This report provides a synthesis of all findings and information generated through a “stocktaking” process that involved a desk study of Prolinnova documents and evaluation reports, a questionnaire to 40 staff members of international organizations in agricultural research and development (ARD),...
Mobile phone based money services have spread rapidly in many developing countries. We analyze micro level impacts using panel data from smallholder farmers in Kenya. Mobile money use has a large positive net impact on household income. One important pathway...
