Agricultural technology assessment for smallholder farms: An analysis using a farm simulation model (FARMSIM)

Previous models used to evaluate the adoption of agricultural technologies have focused mainly on assessing the ex-post impact of technology without necessarily quantifying the profit and risk associated with the adoption of technology. This study introduces a farm simulation model (FARMSIM) that evaluates the potential economic and nutritional impacts of new agricultural technologies before and after they are adopted (ex-ante and ex-post). FARMSIM is a Monte Carlo simulation model that simultaneously evaluates a baseline and an alternative farming technology for a representative farm. The farming technologies under study comprise water lifting technologies (pulley and tank, rope and washer pump, gasoline/diesel motor pump and a solar pump) and fertilizers. The study finds that the use of fertilizers combined with optimal irrigation to grow vegetables and fodder using a motor pump had the highest net present value and profit compared to other scenarios. However, the findings also indicate the scenario under the pulley system, a low cost technology, to be the most feasible with the highest benefit cost ratio. Solar pump system had a lower benefit cost ratio compared to the pulley and motor pump scenarios due to high initial investment cost. Based on simulation results, all four water lifting technologies are profitable and suitable for use in Robit kebele. Moreover, due to improved technologies in alternative scenarios, the nutrition simulation results show in general an increase in food quantities available to the family for calories, proteins, iron, fat, calcium and vitamin A. The daily minimum requirements per adult equivalent were met for all nutrients under study except for fat and calcium. Supplemental nutrition through production and purchase, to fill the gap in fat and calcium is recommended for households in Robit kebele.