Reproducibility package for Yield Gains from Balancing Fertilizer Use: Evidence from Eastern India

As with most agricultural inputs, the optimal use of fertilizer leverages the production complementarities between different types of nutrients. Wide variation in the intensity of nutrient application rates suggests there are potentially large productivity gains to be had from rebalancing fertilizer use across nutrient types even under a fixed expenditure budget. Using detailed information on a large sample of rice fields across three states of eastern India, this paper investigates if a more balanced use of fertilizer—measured as the ratio of Potash to Nitrogen applied to a field—can lead to higher yields and revenues. To address the endogeneity of fertilizer application decisions, we exploit the fact that nitrogen-based fertilizers demanded by Indian farmers are mostly produced domestically in a limited number of manufacturing plants, while all potash-based fertilizers must be imported by ship from abroad. Instrumenting for the ratio of K-to-N fertilizer applied on a field with the relative travel distances between farmer’s villages and both the nearest urea production plant and the nearest international port, we estimate the impact of more balanced fertilizer use on yields and revenues. We estimate that, at median levels of fertilizer use, and keeping the level of expenditure in fertilizers constant, rebalancing fertilizer application choices such that the K-to-N ratio of fertilizer is doubled would lead to a 4.8% increase in yield.