The economics of wet seeding : inducements to and consequences of some recent changes in Philippine rice cultivation

Abstract

The objective of this study is to analyse the reasons for, and consequences of, adoption by farmers in Gapan, Nueva Ecija, Philippines of a new method of rice cultivation.The innovation is wet seeding of rice - the broadcasting of seed instead of transplanting of seedlings. It is thought that wet seeding, which is relatively capital-intensive compared to transplanting, has become economically feasible to farmers because agricultural factor markets in the Philippines are distorted in a way that reduces the price of capital relative to that of labour. Data for the study was collected by the author in the Philippines during January-May 1984. Two hypotheses are proposed and tested herein: that wet seeding is not technically more efficient than transplanting, and that by its substitution of capital inputs for human labour wet seeding is likely to represent a deterioration in equity. Chapter One introduces the theory of induced innovation, which maintains that innovations are adopted having factor-saving biases in accordance with movements in relative factor prices. The extension of this theory to the development of village institutions is also reviewed. In Chapter Two background material is presented, outlining the development of the present rice farming systems in Central Luzon, and investigating the various policy decisions of the Philippine Government in the last decade which have influenced factor and product prices faced by Central Luzon rice farmers. In Chapter Three the results of a survey of Gapan rice farmers are presented are discussed. Economic and econometric analyses conducted are reported in Chapter Four. Tests based upon regression analysis indicate difficulty in rejecting the hypothesis that wet seeding is no more technically efficient than transplanting. The results of partial budgets and other analysis tend to confirm the hypothesis that since efficiency is not increased while factor substitution is taking place, the distribution of income among the various in favour of those who have access to land, and against those who do not. Chapter Five looks more closely into the present employment situation and prospects of landless agricultural labourers in Gapan, reporting the findings of a series of 'key informant' interviews with local labour leaders and others. The findings of these interviews provide additional support for the hypothesis that adoption of wet seeding has made more skewed the distribution of income and opportunity in Gapan. Show more