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Is fertiliser use inconsistent with expected profit maximization in sub-Saharan Africa? “Evidence from Nigeria”

Is fertiliser use inconsistent with expected profit maximization in sub-Saharan Africa? “Evidence from Nigeria”

This article revisits a conventional wisdom that inorganic fertiliser use across sub-
Saharan Africa is too low. This expectation that more farmers should be using
inorganic fertiliser, and at higher rates, implies it is profitable to use rates higher
than observed if farmers are rational expected profit maximisers. We obtain consistent
estimates of the effects of applied nitrogen on rice production. We find the
yield response to applied nitrogen to be low in the main rice growing farming system.
Farmer behaviour is not inconsistent with expected profitability which is limited
by a low yield response to applied fertiliser, high transportation costs, and low
selling prices for rice in rural areas. In particular, we do not find any farmers for
whom applied nitrogen is profitable that are not using fertiliser in the study sample
for each of our survey years (2010 and 2012).


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