Farm size and effects of chemical fertilizer price on farm households: Insights from Nepal Terai

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dc.creatorTakeshima, Hiroyuki
dc.creatorShivakoti, Sabnam
dc.creatorBhattarai, Binod
dc.creatorKarkee, Madhab
dc.creatorPokhrel, Suroj
dc.creatorKumar, Anjani
dc.date2016-12-09
dc.date2024-06-21T09:23:05Z
dc.date2024-06-21T09:23:05Z
dc.date.accessioned2026-06-27T15:05:21Z
dc.descriptionThis research explores how inputs such as chemical fertilizer that are often complementary to labor can benefit smallholders in countries like Nepal. These and other inputs complement labor when a country experiences periods of increased labor scarcity due to rising wages in rural areas. The future of smallholders in Asian countries is vigorously debated in the policy and research arena. An increasing number of studies indicate that in the face of rising rural farm wages, growing mechanization is gradually shifting the advantages enjoyed by smallholders to slightly larger farms in many Asian countries, including Nepal. While the evidence is limited, earlier studies suggest that this trend may also be associated with a greater return to the use of chemical fertilizers by larger farms than by their smaller counterparts. In this paper, we further assess the relationship between the role of chemical fertilizer and farm size in lowland Nepal. In particular, we assess the different effects of chemical fertilizer price on large versus small farm households, depending on farm size. We use the 2003 and 2010 panel data from the Nepal Living Standard Survey. Results generally suggest that in Nepal Terai, lower chemical fertilizer price seems to increase the per capita incomes of farm households with larger landholdings more than it does those with smaller landholdings. The mechanism is somewhat complicated; typically, larger farms benefit through an increased supply of crops from sharecropped/rented farms, which leads to a potential increase in forage supply and increased revenues from livestock production. However, greater benefits for larger farms through this mechanism remains consistent with the greater return to chemical fertilizer among larger farms. This is contrary to the notion that chemical fertilizer is a land-saving input that benefits smaller farms relatively more than it does larger farms. We conclude that fertilizer policy in Nepal should be designed within the broader framework of longer-term agricultural-sector strategies that will impact the future of smallholder farmers.
dc.formatapplication/pdf
dc.identifierhttps://hdl.handle.net/10568/147614
dc.identifier.urihttp://hdl.handle.net/123456789/94174
dc.languageen
dc.publisherInternational Food Policy Research Institute
dc.relationhttps://hdl.handle.net/10568/147444
dc.rightsOpen Access
dc.sourceTakeshima, Hiroyuki; Shivakoti, Sabnam; Bhattarai, Binod; Karkee, Madhab; Pokhrel, Suroj; and Kumar, Anjani. 2016. Farm size and effects of chemical fertilizer price on farm households: Insights from Nepal Terai. IFPRI Discussion Paper 1578. Washington, DC: International Food Policy Research Institute (IFPRI). https://hdl.handle.net/10568/147614
dc.subjectfarm structure
dc.subjectfertilizers
dc.subjecthouseholds
dc.subjectcapacity development
dc.subjectfarm inputs
dc.subjectsmallholders
dc.subjectinorganic fertilizers
dc.subjectexperimental design
dc.subjectprices
dc.subjectfarm size
dc.titleFarm size and effects of chemical fertilizer price on farm households: Insights from Nepal Terai
dc.typeWorking Paper

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Instituto Internacional de Investigación sobre Políticas Alimentarias (IFPRI)