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Contractors will play a vital role in providing farms with access to new precision farming technologies, especially in small-scale farming systems. We investigate the impact of spatial competition among contractors on the uptake of precision farming and the effectiveness of policy interventions, considering alternative spatial price schedules. Conceptual analyses show that a lack of spatial competition among contractors hinders uptake of precision farming technology. The effectiveness of policy interventions to support precision farming also depends on the market structure and contractors’ price schedules. In addition, we illustrate the results in a Swiss case study based on a specific contractors’ service market of plant protection technologies.

 

Precision farming enables agricultural management decisions to be tailored spatially and temporally. Site-specific sensing, sampling, and managing allow farmers to treat a field as a heterogeneous entity. Through targeted use of inputs, precision farming reduces waste, thereby cutting both private variable costs and the environmental costs such as those of agrichemical residuals. At present, large farms in developed countries are the main adopters of precision farming. But its potential environmental benefits can justify greater public and private sector incentives to encourage adoption, including in small-scale farming systems in developing countries. Technological developments and big data advances continue to make precision farming tools more connected, accurate, efficient, and widely applicable. Improvements in the technical infrastructure and the legal framework can expand access to precision farming and thereby its overall societal benefits.