Farmers' Willingness to Pay for 2-Wheel Tractor Hiring Services in Northwestern Ethiopia: A Contingent Valuation Study

This study sought to determine farmers’ willingness to pay (WTP) for 2-wheel tractor hiring services in Northwestern Ethiopia. Survey questionnaire related to CVM was designed and face-to face interview were made to collect the data. Moreover, focus group discussion used to generate qualitative information on household characteristics. Both purposive and stratified sampling techniques were used based on gender, wealth class and soil type of the sampled households. For the study, a total of 144 farm households were considered using double bounded contingent valuation methods approach with an open-ended follow-up question. The study result indicated that the mean amount of money farmers is willing to pay was 1121.026 ETB (56.05 USD) per hectare. Econometric results confirm that the education level of households, land size of households, male labor availability and soil type were the factors that affecting the farmers’ level of willingness to pay positively. However, age of households and tropical livestock unit (TLU) were the factors that affected the same negatively. About 80% of the sampled farmers were willing to use 2-wheel THS. The finding of this study showed that farmers demand for improved 2-wheel THS is high. Hence, there is a need to consider the above factors to introduce 2-wheel tractor hiring service for cultivation practice in the study area.