An Economic Assessment of Banana Genetic Improvement and ...

102 CHAPTER 7
tive sign but are only significant in the decision
to use mulch, which reflects the fact
that mulching is made on the farm using
farmer resources. Although landholding
size increases the availability of mulching
materials, thus enabling farmers endowed
with this physical asset to overcome the
problem of the missing market, scale of
production (represented by areas allocated
to bananas) increases the incentive for
mulching or manure by reducing fixed
costs per unit areas (Feder and O’Mara
1981). Access to income from private assets
does not seem to be important in the decision
to use soil fertility management practices.
This finding reinforces the point that
these technologies are not introduced so
much as they are made on-farm. Consequently,
farmers with income from outside
sources do not have any particular advantages
in gaining access to the technology.
However, results suggest that better access
to bilateral transfers in the form of cash and
gifts is positively associated with the probability
of using soil fertility management
practice (though it is only significant for
manure use). This result could reflect the
effect of social networks on risk aversion
rather than liquidity constraint.
The age of the banana production decisionmaker
and the dependency ratio in the
household are negatively associated with the
probability of manure application and use of
mulching. Age is associated with a short
time preference, which reduces the benefits
of soil conservation technologies (Shiferaw
and Holden 1998). A negative sign on the
dependency ratio reflects labor constraints.
Household size was positively associated
with the probability that the household will
choose to use mulch. In the presence of
output and labor market imperfections,
household size represents both the demand
effects as well the effect of family labor
endowment. Hence it is not clear which
market imperfections explain the result.
The banana price relative to the unskilled
labor wage rate in the village was
significant in both technologies, perhaps
because of the crucial role played by market
incentives in crop management decisions.
After controlling for the market prices, the
probability of using mulching or manure
practices seems to decrease with market access
in general, reflected in the negative effect
of distance from paved roads on the
probability of use. The negative effect of
distance from paved roads on the probability
of using soil fertility management practices
may be related to soil fertility depletion
near the paved roads because of
intensive banana commercialization. This
intensification may increase the farmer perceptions
of soil fertility problem, hence inducing
a higher probability of using soil
fertility management practices. Nkonya et
al. (2004) found a similar result for the effects
of market access on soil nutrient depletion
in eastern Uganda.
Formal mechanisms of information diffusion
(represented by exposure to new banana
varieties and cumulative number of
contacts with extension services) had the
expected signs but were not statistically
significant in most of the regressions, except
for exposure in the use of manure. The low
importance of formal information diffusion
mechanisms in the probability of using soil
fertility management in the Uganda rural
communities is not surprising. Most of the
households surveyed had never had contact
with extension services regarding banana
management. The cumulative number of
contacts with extension services was on average
only 1.88, a level too low to make any
significant impact on decisions regarding
use of knowledge-intensive technologies.
Instead, informal mechanisms of information
diffusion were important determinants
of the decision to use mulch or manure.
Experience with the technology
positively influences its increased use. Results
also suggest that the number of household
members that join associations has no
effect on the probability that a household
will use a soil fertility management prac-