New model shows input subsidies can boost incomes in developing countries.
A new model was created to study how different agricultural policies affect farmers in developing countries. The model looks at how households in rural areas interact with markets and how policies like subsidies and cash transfers can impact their welfare. The researchers tested various policies in six countries and found that in some cases, giving farmers subsidies for inputs like seeds or fertilizer can be almost as effective as giving them direct payments. This shows that certain interventions can help farmers improve their incomes in developing countries.