Abstract

Effect of targeted fertilizer subsidy on poverty reduction in Togo

The reintroduction of innovative forms of input subsidies in SSA following the food crisis of 2008 raises the question of their effectiveness in the fight against poverty. In this context, this paper examined the effect of the targeted fertilizer subsidy implemented in Togo from 2017-2019. The propensity score matching approach was used to control for potential selection bias. Nationwide cross-sectional survey data covering smallholder farmers in Togo, suggest that participation in targeted fertilizer subsidy program significantly improved beneficiaries’ poverty status through the raise of their income, the reduction of the incidence of poverty, the poverty depth and the poverty severity. However, these effects are very marginal compared to the results in other countries particularly in Nigeria. Therefore, to increase the effect of targeted subsidy policy on poverty reduction, public authorities need to improve the rate and the composition of the subsidy.