Does the adoption of complex fertilizers contribute to fertilizer overuse? Evidence from rice production in China

Abstract

Agricultural productivity growth in China highly depends on the use of chemical fertilizers. The past decades have witnessed an increasing adoption of complex fertilizers in China. Given the fact that complex fertilizers are indiscriminately used, however, there is little empirical evidence on the relationship between the adoption of complex fertilizers and fertilizer overuse in China. This study aims to investigate whether the adoption of complex fertilizers contributes to fertilizer overuse in agricultural production in China, and discuss the policy implications for fertilizer reduction. Using survey data covering 1122 rice-producing farm households in China, this study estimates the optimum amount of chemical fertilizers, and utilizes the instrumental variable (IV) Probit estimation to investigate the impact of adoption of complex fertilizers on fertilizer overuse. The results show that more than 85% of the sampled farm households adopted complex fertilizers in rice production, and complex fertilizers accounted for more than half of the total amount of chemical fertilizers. The overuse of chemical fertilizers was extremely common and serious. Given the endogeneity issue, IV Probit estimation shows that each 10-point increase in the percentage of complex fertilizers would increase the probability of fertilizer overuse by 8%. This demonstrates that the adoption of complex fertilizer might significantly contribute to the overuse of chemical fertilizers in rice production in China. To reduce fertilizer use, the Chinese government is expected to encourage the fertilizer enterprises to determine the nutrient ratio based on the soil nutrient content, enhance the soil testing and fertilizer recommendation, and improve the socialized agricultural extension system.