Robustness analysis of organic technology adoption: evidence from Northern Vietnamese tea production

Summary

Increasing consumer awareness on sustainable and healthy food choices has given rise to a growing demand for organic tea in past decades. Most of this demand is met by imports from developing countries. This article examines the main factors affecting the choice of farm households to adopt organic tea production in Northern Vietnam. We apply a logit model to survey data from 241 Vietnamese tea farming households. We assess the robustness of the results by addressing three important statistical issues: (i) regressor endogeneity, (ii) unobserved heterogeneity at farm level and (iii) missing values. The main results are chiefly robust and largely in line with the theory. We find that farm households with higher revenues, located in rich natural and physical environments, are significantly more inclined to adopt organic tea production. Furthermore, the analysis reveals that farm households who are consulted by extension agents and belong to a tea association increase the odds for the adoption of organic tea cultivation.