Awareness About Minimum Support Price and its Impact on Diversification Decision of Farmers in India

Asia & the Pacific Policy Studies, Vol. 4, No. 3, pp. 514–526, September 2017

Crawford School of Public Policy, The Australian National University

13 Pages Posted: 31 Oct 2017

See all articles by K.S. Aditya

K.S. Aditya

Indian Agricultural Research Institute (IARI)

S.P. Subash

National Institute of Agricultural Economics and Policy Research

K.V. Praveen

Indian Agricultural Research Institute (IARI)

M.L. Nithyashree

Indian Agricultural Research Institute (IARI)

N. Bhuvana

Professor Jayashankar Telangana State Agricultural University (PJTSAU)

Akriti Sharma

Indian Agricultural Research Institute (IARI)

Date Written: September 4, 2017

Abstract

In this article, we have analysed farmers’ awareness about Minimum Support Price (MSP) and its impact on diversification of crops grown in India. We used nationally representative data collected by National Sample Survey Office, 70th round data. The data revealed that only 23.72 and 20.04 per cent of farmers in the rural agricultural households in India are aware of MSP of crops grown by them in kharif and rabi season, respectively. From the results of probit model, it is inferred that MSP needs to be backed up by effective procurement coupled with awareness creation by extension system to enable more number of farmers to take benefit of this safety net. We have also explored the relationship between farmers’ awareness about MSP and decision to go for crop specialization using Heckman selection model. The study shows that farmers’ knowledge of MSP had not lead to specialization.

Keywords: Agricultural Policy, Crop Diversification, Minimum Support Price, Crop Specialization

Suggested Citation

Aditya, K.S. and Subash, S.P. and Praveen, K.V. and Nithyashree, M.L. and Bhuvana, N. and Sharma, Akriti, Awareness About Minimum Support Price and its Impact on Diversification Decision of Farmers in India (September 4, 2017). Asia & the Pacific Policy Studies, Vol. 4, No. 3, pp. 514–526, September 2017, Crawford School of Public Policy, The Australian National University, Available at SSRN: https://ssrn.com/abstract=3061564

K.S. Aditya

Indian Agricultural Research Institute (IARI) ( email )

New Delhi
India

S.P. Subash

National Institute of Agricultural Economics and Policy Research ( email )

K.V. Praveen (Contact Author)

Indian Agricultural Research Institute (IARI) ( email )

New Delhi
India

M.L. Nithyashree

Indian Agricultural Research Institute (IARI) ( email )

New Delhi
India

N. Bhuvana

Professor Jayashankar Telangana State Agricultural University (PJTSAU) ( email )

Rajendranagar
Hyderabad, Telangana 500 030
India

Akriti Sharma

Indian Agricultural Research Institute (IARI) ( email )

New Delhi
India

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