Welfare implications of adoption of Fadama III technology among palm oil processors in Nigeria: evidence from Osun state

Abstract

This study investigated the welfare implications of adoption of Fadama III technology among palm oil processors in Osun state, Nigeria. Multistage sampling procedure was used to select 102 palm oil processors in four Local Government Areas (LGAs) in Osun state. Questionnaire was used to collect data. Data were analysed using descriptive statistics, logistic regression, average treatment effect on the treated (ATT) and double difference estimator. The mean income of Fadama III beneficiaries increased by 25% after the project, while those of non-beneficiaries within Fadama LGAs and non-beneficiaries outside Fadama LGAs increased by 7% and 4% respectively, indicating that the Fadama III beneficiaries had the highest increase in income. Age, years of formaleducation, sex of household head and access to creditsignificantly affect the probability of adoption. The ATT results show that being a Fadama III beneficiary increases expenditure by N7,105.37, and results from matched double difference estimator show that the expenditure of the beneficiaries increased by N4,648.79. Adoption of Fadama III technology had positive effect on the welfare of palm oil processors in Osun state. Hence, such community driven development project as Fadama III should be encouraged and the new Fadama III project with additional financing (AF), which covers all LGAs in Osun state, but streamlined to cassava farmers only, should cover other enterprises.