Extension Intermediary Information Distortion
Observational StudyReview
Introducing complex financial innovations through local government extension workers and lead farmers distorts product details, preventing smallholders from understanding contract terms and depressing uptake.
Picture this
Imagine a game of telephone where an insurance company explains a complex policy to a regional official, who explains it to a village extension worker, who explains it to a lead farmer, who finally tells local neighbors. By the time the message reaches the end user, key rules about payouts and credit guarantees have been misunderstood or omitted.
What the evidence says
Sales failed entirely in 11 out of 34 treatment cooperatives (32.4%) due in part to indirect, distorted communication passed through extension agents and model farmers, leaving farmers confused about policy terms.
- Who was studied
- N = 34 treatment primary cooperative villages across 4 zones in Amhara, Ethiopia.
- How
- Field supply-chain implementation analysis tracking communication channels and sales outcomes across 34 treatment primary cooperatives.
What to do
Deploy direct-to-farmer visual marketing campaigns delivered by trained insurance representatives rather than relying on multi-tiered extension networks for novel financial products.
From the source
"In particular the information conveyed to the farmers was not direct, but through Ministry of Agriculture officials, 'model farmers,' and local extension agents. It is not clear whether the information about the nature of the insurance and interlinked credit and insurance contracts was transmitted clearly to all farmers."
Productivity, credit, risk, and the demand for weather index insurance in smallholder agriculture in Ethiopia