Effect of Nigeria’s e-voucher input subsidy program on fertilizer use, rice production, and household income

Abstract

Nigeria introduced an e-voucher fertilizer subsidy program that distributes vouchers directly to a beneficiary’s mobile phone for enhancing agricultural productivity and food security by changing land use from extensive to intensive farming. By using panel data on rice-growing households in 2012 and 2014 and applying a household fixed effects approach and inverse probability weighting methods, we assess whether and how much the e-voucher program increases fertilizer application on rice production. We do not find evidence that the program results in higher fertilizer application. This is because there is a strong crowding-out effect in the study areas in which the private fertilizer market is active. This finding suggests that introducing a potentially innovative device is not sufficient to boost agricultural production and food security.