Three essays in experimental and behavioral economics of technology adoption in India

Shukla, Pallavi

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Description

Title

Three essays in experimental and behavioral economics of technology adoption in India

Author(s)

Shukla, Pallavi

Issue Date

2019-07-03

Director of Research (if dissertation) or Advisor (if thesis)

• Baylis, Kathy
• Arends-Kuenning, Mary

Doctoral Committee Chair(s)

• Baylis, Kathy
• Arends-Kuenning, Mary

Committee Member(s)

• Crost, Benjamin
• Michelson, Hope
• Masters, William

Department of Study

Agr & Consumer Economics

Discipline

Agricultural & Applied Econ

Degree Granting Institution

University of Illinois at Urbana-Champaign

Degree Name

Ph.D.

Degree Level

Dissertation

Keyword(s)

• Experimental Economics
• Behavioral Economics
• Development Economics
• India
• Emergency Contraceptive Pills
• Hermetic Storage
• Improved Storage
• Subsidies
• Reference Dependence
• Experiential Learning

Abstract

This dissertation presents three studies that examine the behavioral phenomena which affect technology adoption in the fields of health and agriculture in developing countries. In the first paper based on the joint work with Mary Arends-Kuenning and Hemant Pullabhotla, I examine whether women's contraceptive method choice can be better understood by applying risk compensation theory. This theory implies that people act with greater care when the perceived risk of an activity is higher and with less care when it is lower. We examine how access to emergency contraceptives pills (ECPs) in India affected women's contraceptive method choices and incidence of sexually transmitted infections (STIs). Although ECPs substantially reduce the risk of pregnancy, they are less effective than other contraceptive methods and do not reduce the risk of STIs. Using an exogenous policy change, we test whether having increased access to ECPs leads people to substitute away from other methods of contraception, such as condoms, thereby increasing the risk of both unintended pregnancy and STIs. We find evidence for risk compensation in terms of reduced use of condoms, but none for increases in rates of sexually transmitted infections. The next chapter focuses on whether short-run subsidies can promote long-run adoption of new technology in developing countries. If so, how large do subsidies need to be to induce adoption by those who benefit the most from the technology? Given the large number of subsidies for agricultural and health technologies in developing countries intended to boost adoption, it is important to evaluate whether they actually increase adoption after the subsidies end. We use two rounds of an auction of improved grain storage technology where access to the technology is driven by random prices drawn at the household level. This approach lets us disentangle the price paid from the initial willingness to pay of the recipient, thus allowing us to contrast the increase in willingness to pay driven by experience with the good to any reference price effects coming from the initial price paid. Utilizing estimates on recipients use of the technology, we calculate the benefits of the storage technology to different farmers and compare that against their willingness to pay. We then use these detailed willingness to pay estimates to calculate the welfare effects of various levels of subsidy. First, we find that experience significantly increases willingness to pay for the technology in the second round of auctions. Second, we confirm that the storage technology benefits farmers: the average farmer recoups the full (unsubsidized) price of the technology in a single agricultural season. Third, we find those farmers with the lowest initial willingness to pay benefit the most from the storage technology, implying that a large subsidy would have been needed to reach those users who derive the most benefit from adopting the technology. In the final chapter based on the joint work with Kathy Baylis and Hemant Pullabhotla, I examine whether providing access to storage technology has the potential to improve food security for smallholder farmers in developing countries. I study the impact of on-farm hermetic storage technology on four dimensions of food security availability, access, utilization and stability. Postharvest losses during storage manifest in reduced quantity of food available to households and reduced quality of stored grain, resulting in decreased household incomes and lower food availability. Improper storage also compromises food safety as well as households ability to delay sales until market conditions are more favorable or to store for consumption during lean periods. In a randomized control trial in India, we find that access to hermetic storage bags led smallholder farmers to store for longer duration, get higher prices for stored grain, substitute consumption away from market sources to own stock, reduce aflatoxin contamination, and decrease postharvest losses during storage. The economic cost-benefit analysis of improved storage technology shows that farmers recover the full, unsubsidized cost of hermetic storage bags in one agricultural season.

Graduation Semester

2019-08

Type of Resource

text

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Copyright and License Information

Copyright 2019 Pallavi Shukla

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