Blog and podcast coverage : World Bank Development Impact Blog • NOVAFRICA Development Economics Job Market Talks Podcast

Linking producers to export markets can improve incomes and welfare, but accessing these markets requires meeting international quality standards. Contracts between producers and buyers may facilitate meeting these standards by aligning incentives, alleviating constraints, and reducing uncertainty for producers. In partnership with two groundnut farming cooperatives in Senegal, we implement a new contracting arrangement that bundles price premium certainty with training and credit for the purchase of a new quality-improving technology. We conduct a randomized experiment to test whether this contract induces adoption of the technology and improvements in production quality. Producers randomly offered the contract are significantly more likely to purchase and use the technology. In areas where quality is otherwise low due to agro-climatic conditions, producers in the treatment group produce significantly higher-quality groundnuts. We also find that producers in the treatment group increase output sales to the cooperative on average. Importantly, the new contract is significantly more effective at increasing sales to the cooperative for producers who are more reciprocal and for whom signaling reliability is more valuable.

We run a randomized controlled trial coupled with lab-in-the-field social network experiments in urban Dakar. Decision spillovers and health externalities play a large role in determining uptake of sanitation technology, with decision spillovers being largest among households that don’t receive significant subsidies. There is no evidence that social mechanisms such as social pressure, learning from others, or reciprocity explain the spillovers. We do find evidence of a fourth, non-social, mechanism impacting decisions: increasing returns to scale. As more neighbors adopt the sanitary technology, it becomes more worthwhile for other households to adopt as well.

Agricultural productivity in Sub-Saharan Africa lags far behind all other regions of the world. A long list of policy experiments has yielded more evidence on what fails than on what works. We analyze a randomized control trial of a rare scaled-up success story: One Acre Fund’s small farmer program. Much like anti-poverty “graduation” interventions, the program aims to relax multiple constraints to productivity simultaneously. We show that participation causes statistically and economically significant increases in output, yields, and profits. In our preferred specification, maize production increases by 24% and profits by 16%. We find little evidence of heterogeneous treatment effects on yields, but observe some attenuation of impacts on total output and profits at the top end of the distribution.