Trouble with zero : The limits of subsidizing technology adoption
Shukla, P.
Trouble with zero : The limits of subsidizing technology adoption - Amsterdam (Netherlands) : Elsevier B.V., 2022.
Peer review
Do users value a free technology less than one they pay for? In a two-stage randomized trial of improved grain storage technology in India, we test whether subsequent user willingness-to-pay is affected by free distribution compared to a small positive price. We find paying an initial price of zero has a strong negative effect on users’ long-run willingness-to-pay but is not associated with differences in either reported use or benefits derived from the technology. The lower valuation implies a 20 to 30 percent decrease in long-run adoption, suggesting free distribution can stifle future markets for repeat-purchase goods.
Text in English
0304-3878 1872-6089 (Online)
https://doi.org/10.1016/j.jdeveco.2022.102920
Technology adoption
Willingness to Pay
Prices
Agriculture
Subsidies
Trouble with zero : The limits of subsidizing technology adoption - Amsterdam (Netherlands) : Elsevier B.V., 2022.
Peer review
Do users value a free technology less than one they pay for? In a two-stage randomized trial of improved grain storage technology in India, we test whether subsequent user willingness-to-pay is affected by free distribution compared to a small positive price. We find paying an initial price of zero has a strong negative effect on users’ long-run willingness-to-pay but is not associated with differences in either reported use or benefits derived from the technology. The lower valuation implies a 20 to 30 percent decrease in long-run adoption, suggesting free distribution can stifle future markets for repeat-purchase goods.
Text in English
0304-3878 1872-6089 (Online)
https://doi.org/10.1016/j.jdeveco.2022.102920
Technology adoption
Willingness to Pay
Prices
Agriculture
Subsidies