Technology Adoption and Economic Transformation in Kenya: The Role of Information, Risk, and Informal Markets

Agricultural technology adoption remains persistently low among small-scale farmers in low-income countries despite the availability of productivity-enhancing and risk-management innovations. This thesis examines the “adoption puzzle” through three interrelated factors: agricultural risk, information, and informal markets. It investigates how farmers perceive risks, value technologies, and respond to information.

The findings show that farmers consider multiple risks, including production, market, financial, and personal risks, and that men and women perceive these risks differently. Farmers’ technology valuations are influenced by prior experience and behavioral biases, while preferences can change when alternative technologies are introduced. Experiential learning, including game-based approaches, improves understanding and decision-making more effectively than conventional information delivery. Finally, providing information on observable attributes that signal otherwise unobservable quality can modestly improve maize quality in informal markets, although effects may fade without sustained interventions. The thesis highlights the importance of reconsidering how risk is conceptualized in small-scale farming systems and leveraging experiential learning and market-based approaches to overcome persistent adoption constraints.