Selective Trials for Technology Adoption

Relatively expensive innovative technologies have a particular barrier to adoption and diffusion: individuals need credible information about the performance of technology before taking the risk of purchasing it. In resource-constrained environments, this information will generally come from experimentation with the technology by an individual’s friends or neighbors or an influential individual in her community. Given this public good aspect of experimentation, standard economic theory predicts that it will be underprovided. The standard approach to overcome this is to subsidize experimentation for a few individuals in each community. Our research tests a number of market-based mechanisms for identifying the optimal experimenters for an innovative production technology – optimal in terms of ultimate diffusion of the technology and ultimate impacts of the experimentation subsidy on output growth for firms (in our specific context, farms) in the community.