Smallholder farmers' willingness to pay for the farmbetter mobile app-based agricultural extension: evidence from a BDM experiment in Tanzania and Burkina Faso

Financial contributions from farmers are increasingly acknowledged as a sustainable mechanism for funding extension services. However, the literature on willingness to pay (WTP) for digital agricultural extension is limited. Conducting a thorough assessment of WTP for digital extension is critical for designing effective pricing policies and ensuring financial sustainability. This study examines the WTP for a novel digital extension platform named farmbetter, leveraging primary data collected in Tanzania and Burkina Faso. The Becker-DeGroot-Marschak (BDM) experiment was used to elicit the amount farmers are willing to pay. We applied the Lasso machine learning to predict the relevant drivers of WTP and used the cross-fit partialing-out method to estimate their marginal effects. We found that half of the sampled farmers are willing to pay less than USD 2.4 monthly for farmbetter services, closely aligning with the threshold required for farmbetter Ltd's financial sustainability under a Business to Consumer (B2C) model. Farmers in Burkina Faso are willing to pay more than those in Tanzania. The key drivers of WTP include socio-economic characteristics, institutional variables, exposure to farm-related stress, digital literacy, smartphone access, and usage of digital tools.