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Profits, supply and HYV adoption in Bangladesh

Rahman, S. ORCID: and Shankar, B. (2009) Profits, supply and HYV adoption in Bangladesh. Journal of the Asia Pacific Economy, 14 (1). pp. 73-89. ISSN 1469-9648

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To link to this item DOI: 10.1080/13547860802661538


The adoption of HYVs (High Yielding Varieties), for increased farm profitability, and the accelerated supply of cereals are important objectives for Bangladesh agriculture. In this paper, we have investigated the manner in which price and non-price factor affect these three criteria, based upon a model of rational variety choice. The model is empirically implemented using translog profit functions and a switching regression framework, and applied to a cross-sectional farm-level dataset of Bangladeshi farms for the 1996 crop year. Results indicate that rice prices, land availability, irrigation, rural infrastructure, labour wages and prices of animal power services are important factors, while fertilizer price plays a marginal role. Given these results, the policy of liberalization of agricultural inputs (particularly fertilizers) and reforms to maintain high rice prices during harvest seasons appear sound since these allow producers to receive rice prices close to world levels without burdening the government with input subsidies. Result also shows that educated Bangladeshi farmers substitute their time inputs away from agriculture, resulting in lower HYV adoption, farm profitability and rice supply.

Item Type:Article
Divisions:No Reading authors. Back catalogue items
ID Code:107882


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