FACTORS AFFECTING MARKET DEMAND OF CROP-IMPROVED CORN SEED IN MÉXICO

Abstract

It is important to identify the factors that increase the utilization rate and demand of improved seed; an informed choice by the corn (Zea mays L.) grower could turn into gains of productivity and welfare. A logit model provided the answer to this question. The logit model considered the logit of the probability ratio of improved seed use against alternative seed use as the dependent variable and production units size, income, improved seed price, fertilizers price and pesticide price as the independent variables. Results indicated that a 10 % increase in production unit size and income per hectare results in increased demand and probability of improved seed by 3.8 and 1.7 %, respectively. A 10 % decrease in the price of improved seed increases demand and probability of improved seed use by 3.7 %. A simultaneous 10 % in prices for improved seed, fertilizer and pesticides results in a 17.5 % increased probability of using improved seed. These results highlight the significant effect agricultural inputs possess on improved seed use and, therefore, in productivity.