Rethinking Agricultural Input Subsidies in Poor Rural Economies

By Andrew Dorward, Peter Hazell and Colin Poulton

Agricultural input subsidies were a common element in agricultural development in poor rural economies in the 1960s and 70s, and were a common element of successful green revolutions. Although they have continued to a greater and lesser extent in some countries, conventional wisdom and dominant donor thinking in the 80s and 90s was that subsidies had been ineffective and inefficient policy instruments in Africa and contributors to government over-spending and fiscal and macro-economic problems. Recent years have seen a resurgence of interest in agricultural input subsidies in Africa and the complementary emergence of innovative subsidy delivery systems. These developments, together with new insights into development processes, require a revisiting of the conventional wisdom on subsidies: an examination of the various development opportunities and constraints facing African farmers, a review of recent experience with input subsidies in Africa, and a thorough re-examination of contributions and implementation modalities of agricultural input subsidies in the Asian green revolution.

File: FAC_Discussion_Paper_005.pdf