Shocks, agricultural intensification, self-help groups, and household welfare: Panel evidence from Tanzania

This study examines the impact of negative income shocks on agricultural intensification measured by the use of improved seeds and inorganic fertilisers and household welfare among maize-growing smallholders in Tanzania. It also assesses whether membership in Savings and Credit Cooperative Societies (SACCOS) and Self-Help Groups (SHGs) helps cushion these effects.

Using panel data from the 2014/15 and 2020/21 waves of the Tanzania National Panel Survey, the analysis applies household fixed effects and district-specific time trends to address unobserved heterogeneity and local-level biases. The study goes beyond aggregating shocks by distinguishing between weather-related, health-related, covariate, and idiosyncratic shocks. To enhance robustness, it incorporates district-level rainfall data to proxy drought conditions. The findings reveal that negative income shocks significantly reduce the adoption of improved seeds but have no significant effect on the use of inorganic fertilisers.

Available at: https://doi.org/10.55158/DEEPCFWP6