Zambia's Agricultural Input Support Programme: Estimating the Impact of the Voucher Delivery System on Crop Diversification

Abstract

Zambia runs an agricultural input support program for 900,000 rural households, primarily targeting maize, the staple crop. A new delivery mode was introduced to the program, initially allowing farmers in 16 of the 115 districts to choose inputs using electronic vouchers, with the aim of encouraging crop diversification, amongst other objectives. Despite the potential benefits of this reform from a theoretical perspective, farmers may not always be able to diversify their crops due to existing barriers. In this paper, we examine how the electronic voucher reform impacted crop diversification and rotation practices at the household level during the pilot phase. The paper combines data from surveys conducted over two waves with 1518 rural households, high-resolution satellite rainfall data and in-depth qualitative interviews with 23 key informants. We find evidence that the reform had a positive impact (an increase of 0.231 points on the Simpson index of diversification) on crop diversification. However, there is no significant direct impact on crop rotation. We nevertheless observed that crop rotation can gain impetus only if farmers fully embrace crop diversification. Results from the qualitative interviews suggest that the limited effectiveness of electronic vouchers could be due to inadequacies in private sector input and output markets, as well as cultural preferences. Several important policy implications arise from these findings, including the need to promote markets for alternative crops and enhance extension services.