DETERMINANTS OF FARMERS’ WILLINGNESS TO PAY FOR SUBSIDISED FARM INPUTS IN MALAWI

Abstract

This study uses the standard Tobit model to calculate both average household and aggregate willingness to pay (WTP) for subsidised fertilizers in Malawi and it traces the determinants of farmers’ WTP for the inputs. The results reveal that smallholder farmers are willing to pay for more inputs in the Farm Input Subsidy Programme (FISP) with the mean household WTP at MK1000 being about ten 50kg fertilizer bags and the total WTP at the same price being 46 891 bags per year for 4742 observed households. Significant determinants of WTP include farm size, food security and radio ownership