Estimating the effect of mineral fertilizer use on Land productivity and income: Evidence from Ghana

Abstract

Soil infertility is a major challenge that leads to high levels of food insecurity and poverty. Soil infertility has led to the introduction of fertilizer subsidy programs (FSP) across Sub-Saharan Africa (SSA) to increase fertilizer use. However, poor targeting, lack of effective coordination, and within-country and cross-border leakages have the diminished program’s impact. In addition to the subsidy program, integrated soil fertility management (ISFM) has been widely promoted under the Soil Health Project (SHP) by the Alliance for a Green Revolution in Africa (AGRA) to increase sustainable food production. This paper provides empirical evidence regarding the impact of mineral fertilizer adoption on land productivity and agricultural income among rice farmers in Ghana. Adoption of mineral fertilizer is influenced by access to off-farm income, years of farming experience, residential status of a farmer, total farm size, use of fallow methods of soil management, and household size. Employing endogenous switching regression and propensity score matching methods and using farm household survey data from northern Ghana, we find that mineral fertilizer use significantly increases land productivity and agricultural income by 55% and 30%, respectively. Our results suggest positive welfare effects of fertilizer use, thus supporting the need to increase farmers’ access to mineral fertilizer by eliminating the bottlenecks with respect to input into the subsidy program to ensure that fertilizers are released to farmers on time and applied in a timely manner to fields to improve overall soil fertility and increase sustainable food production.