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Replacing the Chemical Fertilizer Through Eco-Friendly Technologies Developed for Paddy Cultivation: How Much Farmers are Willing-To-Pay For?

De Silva. L.H.N, Lakmali. C.D.A., Jayasinghe-Mudalige. U.K., Dharmakeerthi. R.S., Dandeniya. W.S. and Balasooriya. W.K.


Bio-fertilizer is one of the Eco-Friendly Technologies (EFT) developed through a multi- phased project to reduce the quantity and frequency of Chemical Fertilizer (CF) usage in paddy farming. What factors trigger farmers to adopt EFTs in the field, and more importantly, the “role of economics” in adoption of such technologies is, however, not yet fully understood. This study explores the outcome of an economic analysis carried out to determine the willingness-to-pay (WTP) of farmers, as potential end-users, for Bio- fertilizer. Structured questionnaire-based, face-to-face interviews were conducted aiming a set of paddy farmers (n=120) registered with a multi-stage, multi-criteria project in Anuradhapura and Kurunegala Districts to collect data. Choice Experiment (CE) method was employed to elicit farmers’ Marginal Willingness-To-Pay (MWTP) for the deliverables of the product. The estimates from Conditional Logit model revealed that certain attributes, including ‘high nutrient solubilizing rate’ (i.e. the highest value of Rs. 908 per acre), ‘promotional activities through farmer meetings’ (Rs. 749 per acre), ‘low environmental damage’ (Rs. 471 per acre), ‘powdered form of fertilizer’ (Rs. 458 per acre) and ‘availability through private markets’ (Rs. 320 per acre) possess a significant relationship with farmer’s WTP. The outcome of the study implies that the farmers, in general, exhibits positive attitudes and willing to pay relatively high prices for eco-friendly attributes associated with EFTs like Bio-fertilizer, but needs to expose a modified product according to farmer preferences to offset short-term benefits of chemical fertilizer use.

KEYWORDS: Choice experiment, Eco-friendly technologies (EFTs), Marginal willingness-to- pay (MWTP)

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