CAREER: Empirical Studies of Technology Adoption

Stanford University, Stanford CA

Investigators

Abstract

Abstract Proposal Title: CAREER: Empirical Studies of Technology Adoption Proposal Number: SES - 1254167 Principal Investigator: Pascaline Dupas Higher adoption of available technology could significantly improve various aspects of wellbeing in developing countries. Two thirds of child mortality could be eliminated through adoption of available technologies, such as vaccines, antimalarial bednets, and oral rehydration salts. Average maize yields in sub-Saharan Africa are three to five times lower than yields attained by agricultural extension workers in the same region using technologies now universal in rich countries, such as improved seed varieties and fertilizer. How can adoption of these and other technologies be increased in developing countries? What barriers do households and providers face? How can these barriers be overcome? The research under this CAREER award aims to advance our understanding of technology adoption in developing countries through: (a) enabling and performing empirical tests of economic theory on three determinants of technology adoption- subsidies, financial access, and education - through a series of field experiments embedded in longitudinal data collection efforts; (b) enhancing educational opportunities for students and educators interested in development; and (c) filling gaps in the knowledge base available to the practitioners who develop policies and programs to foster technological transition. The research component has three strands. The first research strand exploits randomized subsidy experiments in Ghana and Malawi, combined with innovation in measurements, to examine when and how subsidies for a new technology can foster learning about its effectiveness and trigger diffusion. Both demand-side and supply-side factors are being considered, in particular: how to target subsidies to those most likely to actually experiment with the new technology, and once a targeting scheme has been established, how to limit corruption and guarantee the subsidy reaches those it targets. The second research strand exploits randomized variation in access to financial products in Kenya, Malawi and Uganda to estimate how financial exclusion impedes technology adoption. Namely, does the fact that the great majority of the poor in rural Africa have limited ability to borrow and no formal means to save limit technology adoption? What financial products can boost their investments in technology and why does the market not provide them? The third research strand exploits the randomized assignment of education subsidies to youths in Ghana, combined with a 10-year panel dataset, to estimate the causal impact of secondary education on technology adoption and shed light on the pathways: does secondary education equip individuals with cognitive skills that are complementary with technology, does it enable them to hear about technology more easily, or does the effect of education on technology adoption operate primarily through an income effect? This research agenda embeds a comprehensive education plan aimed at disseminating the research findings and methods to policymakers from the developing world, enabling better understanding of and greater interest in development issues among high school and undergraduate students, and offering international research opportunities for college students and college graduates, as well as for graduate students wanting to study development issues. This work will generate and disseminate new evidence on questions debated by policymakers and practitioners, not only those in government but also those in institutions that shape global development agendas and resource allocation, from private foundations to bilateral agencies such as USAID and multilateral agencies such as the UN and the World Bank. One such debate is on whether and how new technologies should be subsidized when they are first introduced. The proposed work will inform this debate, potentially impacting the design of subsidies to encourage immediate and long-term diffusion. Another debate is on the relative costs and benefits of expanding banking services to the rural poor. The proposed work will inform this debate, potentially impacting the regulation and incentives of both providers and households in poor countries. Yet another debate is on the importance of secondary education. There is much evidence on the importance of primary education but little on that of post-primary education. The proposed work will contribute evidence on both the private and social returns to secondary education, potentially impacting expansion of secondary education. Finally, the proposed work will generate innovative survey instruments and rich panel datasets and make them public, and in doing so will stimulate further relevant research.