Farmers' willingness to pay for smart farming technologies: evidence from a smart drip irrigation technology in North China
China Agricultural Economic Review
ISSN: 1756-137X
Article publication date: 5 December 2023
Issue publication date: 22 March 2024
Abstract
Purpose
Smart farming technologies (SFTs) can increase yields and reduce the environmental impacts of farming by improving the efficient use of inputs. This paper is to estimate farmers' preference and willingness to pay (WTP) for a well-defined SFT, smart drip irrigation (SDI) technology.
Design/methodology/approach
This study conducted a discrete choice experiment (DCE) among 1,300 maize farmers in North China to understand their WTP for various functions of SDI using mixed logit (MIXL) models.
Findings
The results show that farmers have a strong preference for SDI in general and its specific functions of smart sensing and smart control. However, farmers do not have a preference for the function of region-level agronomic planning. Farmers' preferences for different functions of SDI are heterogeneous. Their preference was significantly associated with their education, experience of being village cadres and using computers, household income and holding of land and machines. Further analysis show that farmers' WTP for functions facilitated by hardware is close to the estimated prices, whereas their WTP for functions wholly or partially facilitated by software is substantially lower than the estimated prices.
Practical implications
Findings from the empirical study lead to policy implications for enhancing the design of SFTs by integrating software and hardware and optimizing agricultural extension strategies for SFTs with digital techniques such as videos.
Originality/value
This study provides initial insights into understanding farmers' preferences and WTP for specific functions of SFTs with a DCE.
Keywords
Acknowledgements
The authors gratefully acknowledge the financial support from the National Natural Science Foundation of China (Grant No. 72173050) and the General Project for Humanities and Social Sciences Research funded by the Ministry of Education of China (Grant No. 20YJC790152).
Since submission of this article, the following author(s) have updated their affiliations: Liangzhi You is at the College of Economics and Management, Huazhong Agricultural University, Wuhan, China and Macro Agriculture Research Institute, Huazhong Agricultural University, Wuhan, China.
Citation
Tao, H., Xiong, H., You, L. and Li, F. (2024), "Farmers' willingness to pay for smart farming technologies: evidence from a smart drip irrigation technology in North China", China Agricultural Economic Review, Vol. 16 No. 1, pp. 114-134. https://doi.org/10.1108/CAER-03-2023-0050
Publisher
:Emerald Publishing Limited
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