The key to increasing yields is to ensure that even the poorest farmers have access to improved seed varieties (usually "hybrid" seeds created by scientific selection of seed varieties), chemical fertilizers, organic matter to replenish soil nutrients, and, where possible, small-scale irrigation methods, such as a pump to lift water from a nearby well. There is nothing magical about this combination of high-yield seeds, fertilizer, and small-scale irrigation. It is the key to the worldwide increase in food production since the 1960s.
The problem is that these improved inputs have bypassed the poorest farmers and the poorest countries. When peasants lack their own saving accounts and collateral, they are unable to borrow from banks to buy seeds, fertilizer, and irrigation. As a result, they grow food the traditional way, often earning little or nothing from their harvest, because it's not even enough to keep their families alive.
History has shown that government action is required to help the poorest farmers escape the low-yield poverty trap. If farmers can be helped to obtain simple technologies, income can rise, and they can accumulate bank balances and collateral. With a bit of temporary help, perhaps lasting around five years, farmers can build up enough wealth to obtain inputs on a market basis, either through direct purchases from savings or through bank loans.
Around the world, government-run agricultural banks in poor countries once not only financed inputs, but also provided agricultural advice and spread new seed technologies. Of course, there were abuses, such as the allocation of public credits to richer farmers rather than to needy ones, or the prolonged subsidization of inputs even after farmers became creditworthy. And in many cases, government agricultural banks went bankrupt. Still, the financing of inputs played a huge and positive role in helping the poorest farmers to escape poverty and dependency on food aid.
