Exploring the impact of agricultural digitalization on smallholder farmers' livelihoods in Ghana

Abstract

With the government's pursuit of a digitalization agenda, Ghana is at the forefront of championing digital transformation in Africa. However, people in rural areas are being left behind in harnessing the immense benefits of digitalization for their livelihoods. This study contributes to policy efforts aimed at bridging that gap by investigating the drivers of agricultural digitalization (AD) as well as its effects on the livelihoods of smallholder farmers in rural Ghana. Data from a cross-sectional survey of 525 rural farmers across northern, middle and southern Ghana was employed. The study used the probit and tobit estimators to analyze the drivers and intensity of adoption of digital technologies in agriculture and the inverse probability weighting and regression adjustment estimator to mitigate endogeneity concerns. The results show that while female farmers trail male farmers in the intensity of applying digital technologies, higher educational attainment, better perception of digitalization, group/cooperative membership, number of economically active household members, and access to reliable electricity, internet and mobile money services significantly promote the use of digital technologies in agricultural activities. The results further show that AD is significantly associated with perceived improvements in livelihood assets, and ultimately livelihood outcomes of smallholder farmers in rural Ghana. These findings highlight the importance of investing in rural digital infrastructure by policymakers, the private sector and other stakeholders, so as to expand access to and the uptake of digital technologies in agriculture to bolster rural development in Ghana.