Understanding of technology adoption decisions: a perspective from Social Capital Theory

Water availability is of increasing concern to agricultural production. On one hand, recent studies have demonstrated that climate change has had a significant impact on rainfall cycles, altering the occurrence of droughts and flooding, which in turn affect agricultural yields in all geographic areas of the world. Chile is not exception in this regard, and projections for the Central-South region anticipate a decrease in precipitation of up to 40% and a rise in temperatures between 2°C and 4°C in the next 40 years. In this scenario, experts have ranked the use of irrigation technology as one of the most effective ways to adapt to climate change, preventing water scarcity and helping to increase water conservation. Moreover, irrigation technology has proved to be effective in increasing productivity as well as reducing risk.

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However, although irrigation technology is available, for various reasons the rate of adoption is rather low. Only 30% of the cultivated area in Chile has pressurized irrigation, despite the fact that the government provides farmers with a subsidy for infrastructure and improvement of irrigation. Then, how can adoption of modern irrigation systems be increased? Several studies show that adoption decisions at the individual level are influenced by farm level characteristics, socio-economic variables, human capital characteristics, among the most relevant.

However, there is not clear conception on how the social capital components interact to define the behavior of the producer. Understanding these interactions may shed light on the factors of social capital that can drive decision-making processes towards a specific behavior. From this statement, two questions arise. What is the relationship of social capital and the behavior of farmers regarding the use of a technology; and how are social capital components related to each other?. These three questions, although related, correspond to three different aspects in the understanding behavior.

We use as case study irrigation adoption in vineyards in the Maule and O’Higgins regions of Chile. Wine grapes are one of the most important crops in the Chilean agricultural sector, with the planted area in these regions, in 2012, accounting for 73% of the national total. Increasing Chilean wine production and exports have pushed this sector to make relevant changes in productive strategies, especially producing high quality grapes, which are very sensitive to water stress management.