Potential economic and poverty impact of improved chickpea technologies in Ethiopia. Socioeconomics Discussion Paper Series 9

Macharia, I and Orr, A and Asfaw, S (2013) Potential economic and poverty impact of improved chickpea technologies in Ethiopia. Socioeconomics Discussion Paper Series 9. [Socioeconomics Discussion Paper Series]

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The national agricultural research organization of Ethiopia in collaboration with the International Crops Research Institute for the Semi-Arid Tropics (ICRISAT) developed and released a total of 11 improved chickpea varieties between 1974 and 2005. These varieties are high-yielding, stress tolerant, with desirable agronomic and market traits. However, until now there exists no systematic study to assess the economic impact of this research investment in Ethiopia. This information is useful for justifying future donor investments and other collaborative ventures in such projects. The objective of this study is to assess the potential economic and poverty impact of improved chickpea varieties adopted by Ethiopian farmers. The economic surplus model (based on DREAM model) was applied to estimate total benefits. With an annual chickpea production of 175,734 tons, chickpea price of US$ 164/tonne, a 31% production benefit, a supply and a demand elasticity of 0.9 and -1.4 respectively, maximum adoption of 75% and an annual increase of consumption of 2.6%, the economic surplus produced was estimated at US$ 111 million for 30 years. Consumers are estimated to get 39% of the benefit and producers 61%.With project costs of US$ 22 million, the benefit cost ratio is estimated at 5:1 and an internal rate of return of 55%, indicating that the investment is profitable. Even with the worst-case scenario i.e. lowest benefit (15%), highest discount rate (13%), lowest elasticities and price the benefit-cost ratio of 2:1, still justified the investment. The generated benefit is expected to lift more than 0.7 million people (both producers and consumers) out of poverty. Thus, further investments in the chickpea and other legume research in Ethiopia is justified as a means of poverty alleviation

Item Type: Socioeconomics Discussion Paper Series
Series Name: Socioeconomics Discussion Paper Series 9
Uncontrolled Keywords: Economic impact, chickpea, improved varieties, Ethiopia
Subjects: Others > Agriculture-Farming, Production, Technology, Economics
Depositing User: Mr Sanat Kumar Behera
Date Deposited: 19 Nov 2013 04:58
Last Modified: 10 Nov 2014 09:14
URI: http://oar.icrisat.org/id/eprint/7244
Acknowledgement: UNSPECIFIED
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