Determinants of adoption and levels of demand for fertilizer for cereal growing farmers in Ethiopia

The current govenrmnet of Ethiopia has put agricultural at the heart of its policies. there is particular emphasis on prompting adoption of fertlisier, improved seeds and the efficiency of inputs marketing and distribution. In this paper we use a nationaly representative data set for 1994 to analyse what factors influence adoption of as well as intensity of fertiliser use of small-scale farmers. results show that farmer literacy, access to all-weather roads, acces to banking, extension services, and the labour availability play a role in fertiliser adoption. Addressing the first four points would substantially increase the rate of adoption. With regard to the amount of fertliser used we find that smaller sized farms use this input more intensively. Further we find that previous experience with fertiliser, supply, liquidity, oxen owned owned by the household, and the ratio of the price of the main crop to the cost of fertiliser are important. Availability of credit ad supply constraints ar important factors in constraining fertliser use. Our results suggest that the effect of the subsidy on fertiliser consumption is small and that providing credit would be much more effective in terms of raising adoption of level of use of fertliser and thus contributing to increasing agricultural output.