Understanding the heterogeneous effect of microcredit access on agricultural technology adoption by rural farmers in Ethiopia: A meta-analysis

Abstract

Though the Ethiopian economy is predominantly agriculture-based, the adoption of agricultural technologies has been very low. The results of a previous study had shown that microcredit access was one of the factors affecting the adoption of agricultural technology in Ethiopia. However, its effect has not yet been analyzed at the meta-level. Therefore, this study employed meta-analysis to understand the heterogeneous effect of microcredit access among farmers adopting agricultural technologies. We used subgroup analysis and meta-regression analysis to identify the heterogeneity level of credit access on technology adoption using the random-effects (RE) model. The study observed that there was a positive effect of microcredit access on agricultural technology adoption with a log odds ratio of 1.59. The subgroup analysis revealed a 93.2 % overall variation (I2) with a p-value of 0.000, signifying a significant level of microcredit access within the between-groups heterogeneity of agricultural technology adoption studies conducted in Ethiopia. Notably, this was reflected by the adoption of improved livestock technologies, fertilizers, seed varieties, multiple agriculture, and irrigation technologies, with rates of heterogeneity of 94.9 %, 94.4 %, 94.3 %, 85 %, and 73.8 %, respectively, all with a p-value of 0.000. In addition, the meta-regression analysis results indicate that household experience, distance to the market, and income are significant moderators that affect the technology adoption decisions of farmers in rural Ethiopia. These findings suggest that policymakers should focus on improving the financial facilities and extension systems for rural farmers to enhance the adoption of agricultural technologies to increase production efficiency.