Labor saving innovations are essential to increase agricultural productivity, but they might also increase inequality through displacing labor. Empirical evidence on such labor displacements is limited. This study uses representative data at local and national scales to analyze labor market effects of the expansion of oil palm among smallholder farmers in Indonesia. Oil palm is labor-saving in the sense that it requires much less labor per unit of land than alternative crops.
The use of mobile phones has increased rapidly in many developing countries, including in rural areas. Besides reducing the costs of communication and improving access to information, mobile phones are an enabling technology for other innovations. One important example are mobile phone based money transfers, which could be very relevant for the rural poor, who are often underserved by the formal banking system. We analyze impacts of mobile money technology on the welfare of smallholder farm households in Kenya.
Background
Sustainable intensification of agriculture will have to build on various innovations, but synergies between different types of technologies are not yet sufficiently understood. We use representative data from small farms in Kenya and propensity score matching to compare effects of input-intensive technologies and natural resource management practices on household income. When adopted in combination, positive income effects tend to be larger than when individual technologies are adopted alone.