The effect of climate-smart agriculture on productivity and cost efficiency: Insights from smallholder wheat producers in Pakistan

Panhwar Ghulam Mustafa; Shangao Wang; Gershom Endelani Mwalupaso; Yi Yu; Zhou Li

The effect of climate-smart agriculture on productivity and cost efficiency: Insights from smallholder wheat producers in Pakistan

2024

Panhwar Ghulam Mustafa | Shangao Wang | Gershom Endelani Mwalupaso | Yi Yu | Zhou Li

Unique challenges have been elicited by climate change, demanding the utilisation of effective adaptation strategies that are both environmentally and economically sustainable. Regrettably, the agricultural sector has not been spared from the effects of climate change, but it is among the largest employers and the primary source of food security globally. The situation is worse in Pakistan, where poverty, hunger, and malnutrition are reported to be prevalent. The complexity of risks posed by climate change has called for climate-smart agriculture (CSA) technologies, which potentially could augment cost efficiency and yield in wheat production. Surprisingly, previous studies have largely overlooked this crucial aspect. Therefore, our research seeks to address two fundamental questions: What is the comparative cost efficiency between adopters and non-adopters of CSA practices in wheat production? And what are the yield effects associated with CSA adoption, particularly compared to non-adopters? To this end, a multi-stage sampling technique was employed to randomly select 400 farm households in a climate risk hotspot province in Pakistan, on which the stochastic frontier analysis (SFA) and endogenous switching regression (ESR) were applied. The results revealed that CSA adoption was associated with improved cost efficiency and yield. Interestingly, if non-adopters decided to adopt CSA, they would increase their wheat yield by about 20%. Given the importance of wheat for food security, this would contribute to poverty and hunger eradication. Therefore, our study conforms to the aspirations of the 2030 agenda by promoting rethinking food production through possible improvement in cost efficiency and yield in the face of a changing climate.

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