Sequential Adoption and Cost Savings from Precision Agriculture

• Main Authors: David Schimmelpfennig, Robert Ebel
• Format: Article
• Language: English
• Published: Western Agricultural Economics Association 2016-01-01
• Series: Journal of Agricultural and Resource Economics
• Subjects: crop production information technologies; joint adoption; technology adoption
• Online Access: https://ageconsearch.umn.edu/record/230776

Precision agricultural (PA) technologies can decrease input costs by providing farmers with more detailed information and application control, but adoption has been sluggish, especially for variable-rate technologies (VRT). Is it possible that farmers have difficulty realizing these cost savings? Combinations of PA technologies are considered as complements, testing several patterns of PA technology adoption that may show different levels of costs. The USDA's Agricultural Resource Management Survey of corn producers is used to estimate a treatment-effects model that allows for selection bias. VRT contributes additional production cost savings when added to soil mapping, but not when done with yield mapping alone.