Agricultural inputs, seeds and fertilisers
Rethinking agricultural input subsidies in poor rural economies
Is it time to rethink conventional wisdom on agricultural subsidies?
Authors:
A. Dorward; P. Hazell; C. Poulton
Publisher:
Future Agricultures Consortium, 2008
Recent years have seen a resurgence of interest in agricultural input subsidies in Africa, together with the emergence of innovative subsidy-delivery systems. This brief argues that these developments, together with new insights into development processes, make it necessary to revisit the conventional wisdom on subsidies.
The paper examines the arguments for subsidies, in addition to the problems associated with them. It then moves on to look at the new thinking on input subsidies in Africa and the case of the Asian green revolution more thoroughly.
The authors argue that there are important questions that need investigation, about past and present successes and failures in agricultural input subsidy programmes. These need to examine both the impacts of such programmes and the necessary and sufficient conditions for the achievement of beneficial impacts.
Whilst agricultural input-subsidy impacts have been extensively studied in the past, it is argued that a new look at these questions is needed to address a wider set of impacts than have been considered in the past (including particularly the role of subsidies in promoting structural change), together with a broader set of implementation issues regarding subsidies themselves (their mode, sequencing and policy context), as well as the complementary policies needed for these wider impacts to be achieved. A conceptual framework for such a study is offered by the authors.
The brief concludes that the call for new research on agricultural input subsidies is urgent, for two reasons:
- first, there is an urgent need for better information to guide input-subsidy policy design, investment and implementation. Pressure for investments in inputs subsidies in Africa is growing and it is important that subsidy debates and policies are informed by up-to-date understanding of options and impacts, founded on relevant and rigorous research
- second, the successful implementation of input subsidies in many Asian green revolution countries occurred 40 to 50 years ago. Many professionals who were involved as implementers or analysts have already retired: there is limited time to ask new questions about these historical events and processes.
