Green revolution, white revolution, and a bright future: lessons from Tamil Nadu, India

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Green revolution, white revolution, and a bright
future lessons from Tamil Nadu, India
Kei Kajisa (IRRI FASID) Venkatesa Palanichamy
(TNAU)
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Background (1)

• Positive interactions between crop and livestock
  sectors.
• Differential impacts of FYM
• (Rasmussen et. al, 1998 Dawe, et. al.,
  2003 Edmeades, 2003 Hati et al., 2007)

Ordinary soil Poor soil
Lowland rice little Some
Upland cereals Some High
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Background (2)

• Retail price of chemical fertilizer is very high.
• Examples price (US) of 50 kg of chemical
  fertilizer in 2006
• Kenya 24.6
• Mozambique 27.5
• Botswana 39.5
• Ghana 19.5
• Egypt 6.7
• Intl mkt 17.9 (urea in 2007)
• Role of locally produced FYM as substitute for
  chemical fertilizer
• Upland cereals are the staple crops for many
  African countries

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Research Issue

• It is important to consider how to incorporate
  livestock sector into ag development strategy for
  Africa
• Paucity of empirical research that explore the
  impact of crop sector development and livestock
  sector development together.
• TN has experienced GR (1970s) and WR (1980s).
• Using TN data, we investigate
• How has the farming system changed over time?
• What are the impacts? (by crop, by soil type)
• How have they contributed to the poverty
  alleviation?

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Data

• Cost of Cultivation of Principal Crops (CCPC)
  scheme in Tamil Nadu

Period Sampling Sample Size Questionnaire
1971-80 Annual 40 villages 400 HHs
1981-92 3-year rotating panel 60 villaegs 600 HHs
1993-onward 3-year rotating panel 60 villaegs 600 HHs Detailed dairy data Soil type data
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(No Transcript)
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Findings from recent CCPC data (1993-2003)

• A direct impact of FYM application exists only
  for upland cereals but not for paddy.
• An indirect impact through an increase in the
  marginal product of chemical fertilizer is
  observed for both paddy and upland cereals,
  particularly when soil quality is inherently
  poor.
• The impacts are spatially constrained within a
  village where dairy sector development has taken
  place because FYM markets are not integrated
  beyond the villages due to its non-tradable
  attribute.

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Key Hypotheses

• The development of dairy sector increases the
  supply of FYM.
• Productivity and profitability of crop farming
  increase faster (or does not decline faster) over
  time in the areas with the dairy sector
  development than in the areas without it.
• The above feature is more clearly observed for
  upland cereals than for lowland paddy, as well as
  for poor soil type areas than for rich soil type
  areas.
• Dairy development contributes to poverty
  alleviation in poverty prone area (cultivating
  upland cereal under poor soil condition).

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Descriptive stat (1)
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Descriptive stat (2)
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Descriptive stat (3)

• Change of per capita HH income from 93-95 to
  2001-03.

Good soil Poor soil
Dairy villages 25 ? 34 (35) 20 ? 30 (50)
Non-dairy villages 17 ? 20 (18) 14 ?19 (43)
Income Rs. in 1973 value
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Econometric Approach

• yijtf(Xijt, Djt aij aj)
• yijt yield (paddy/cc), profit (paddy/cc), HH
  income of HH i in village j in year t
• Xijt determinants of HH
• Dj village-level indicator of dairy sector
  development
• a fixed effects
• Can we safely assume Dj is exogenous to each
  individual? ? IV method?

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• Thank you very much