Who Cares What Others Think (or Do)? Social Learning and Social Pressures in Cotton Farming in India

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Abstract

This paper examines the role that social networks play in the adoption process of Bacillus thurigiensis (Bt) cotton, a type of genetically engineered cotton that has been available on the Indian market since 2002. Using a unique dataset and empirical methodology, I find that farmers appeared to have exclusively learned from the experimentation of a small set of “progressive” farmers in the village, that is, adoption by other (“regular”) farmers was not considered a useful source of information about the technology. Second, I find evidence of social pressures, originating from the belief that Bt cotton might be hazardous to the environment and livestock, which inhibited adoption, at least for some time.

JEL codes: O3, Q1.

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