Economic Impact Calculation

Module 2: Economic Impact

Why Calculate Economic Impact?

The ultimate goal of farmer segmentation is to estimate the economic consequences of biofortified seed adoption. Different farmer segments will experience different outcomes:

Non-hybrid farmers see the largest yield increase and take on the largest rise in seed cost, since they start from near-zero seed expenditure
Low segment farmers gain from the yield increase with no change in seed costs
Mid segment farmers see a small yield increase alongside a seed cost saving
High segment farmers face a yield reduction that the seed cost saving offsets in part

This module calculates individual farmer level economic impacts using a counterfactual approach: comparing each farmer’s projected situation under biofortified adoption against their current baseline.

The figures presented here correspond to the baseline scenario combining the 2022 biofortified seed variety (currently deployed in the field) with the current subsidy regime as of April 2026. Alternative seed variants and subsidy regimes are evaluated in the Shiny dashboard.

Counterfactual Methodology

The economic impact model follows a counterfactual approach: for each farmer, we calculate:

Current economic situation — Income from sales + value of self-consumption − input costs, at the conventional and non-hybrid seed prices applicable to the current subsidy regime.
Projected situation with biofortified seed — Same calculation with adjusted yields and the biofortified seed price applicable to the current subsidy regime.
Economic impact — Difference between projected and current net income.
Subsidy benefit — Monetary value of the subsidy received by each farmer, expressed both as an absolute value (relative to the unsubsidized commercial reference price) and as a delta relative to the current subsidy regime.

Economic Logic

Sellers benefit from increased production × sale price.
Non-sellers benefit from increased self-consumption value × purchase price.
All farmers face a change in seed costs that depends jointly on segment and subsidy regime.

The model assumes non-seed input costs remain constant, as biofortified varieties do not require different agronomic practices.

Economic Parameters

Two parameter families enter the impact calculation: per-segment seed costs, conventional and biofortified, and per-segment yield change factors. Seed costs come from the subsidy regime configuration, here the current regime; yield change factors from the seed variant configuration, here the 2022 seed.

Table 1: Economic Parameters for Impact Calculation

Economic Parameters by Farmer Segment. Seed costs (Q/mz) and yield change factors — 2022 Seed, Current subsidy
Segment	Seed Cost (Q/mz)			Yield
Economic Parameters by Farmer Segment
Seed costs (Q/mz) and yield change factors — 2022 Seed, Current subsidy
Segment	Conventional	Biofortified	Change	Factor	Change
OPV/Criollo	61	305	244	0.316	+31.6%
Low	305	305	0	0.256	+25.6%
Mid	488	305	−183	0.018	+1.8%
High	976	305	−671	−0.138	-13.8%
Source: Semilla Nueva refined seed prices and yield data. Green = cost reduction; Red = cost increase.

Reference Prices

Reference prices are computed data-driven from ENCOVI 2023 (MAGA-calibrated) using survey-weighted medians:

Sale price — Median per-quintal price across selling households, using revenue / qty_sold_qq for households flagged is_seller == 1.
Purchase price — Median per-quintal valuation proxy across self-consuming households, computed as value_household / qty_household_qq.
Shadow price — Simple average of sale and purchase prices (price-band midpoint), applied to autarkic households whose maize neither enters nor leaves the market.

The purchase price represents the opportunity cost of consuming own production rather than buying maize from the market, and is used to value self-consumption for net buyers in Phases C and D.

Table 2: Reference Prices for Economic Valuation

Reference Prices for Economic Impact Calculation. Survey-weighted median prices (Q/qq)
Price Type	Value (Q/qq)	N (observations)	Calculation
Reference Prices for Economic Impact Calculation
Survey-weighted median prices (Q/qq)
Sale (national median)	192.5	1,891	revenue / qty_sold_qq
Purchase (self-consumption proxy)	209.1	6,913	value_household / qty_household_qq
Shadow (sale-purchase midpoint)	200.8	—	(price_sale + price_purchase) / 2
Source: ENCOVI 2023 (MAGA-calibrated). Sale price applies to net-seller households. Purchase price applies to net-buyer households. Shadow price applies to autarkic households (no market participation) and represents the price-band midpoint.

Subsidy Regime Reference

The current subsidy regime, in effect as of April 2026, fixes the biofortified seed price paid by farmers at a uniform level across all segments. The reference unsubsidized commercial price anchors the absolute monetary value of the subsidy, quantified in the subsidy benefit section below.

Table 3: Subsidy Regime Reference

Subsidy Regime Reference. Configuration in effect for this run — Current subsidy
Field	Value
Subsidy Regime Reference
Configuration in effect for this run — Current subsidy
Subsidy regime	Current subsidy
Description	current subsidy regime as of April 2026
Reduction relative to current regime	0%
Reference unsubsidized biofortified price	547 Q/mz
Subsidy suffix (file naming)	sub00
Source: Semilla Nueva refined subsidy values, April 2026.

Market Position Classification

Each farmer household is classified by its position in the maize market based on observed sale and purchase volumes. This classification feeds the differential valuation of self-consumption applied in subsequent phases: net sellers value retained production at the sale price (foregone revenue), net buyers at the purchase price (avoided expenditure), and autarkic households at the shadow price (price-band midpoint, since no observed market price applies).

Classification logic. For each household, three shares are computed against total maize volume (sold + purchased + retained for own consumption): sale share, purchase share, and retained share. A tolerance threshold epsilon = 5% defines functional zero, accommodating measurement error inherent in 15-day recall surveys. Mixed-quadrant households (positive sale and positive purchase) are resolved by the sign of their net market position: functional sellers when positive, functional buyers when negative, autarkic when zero.

Table 4: Distribution of Market Positions Across the Farmer Population

Market Position Distribution. Survey-weighted, threshold epsilon = 5%
Market position	N (raw)	N (weighted)	% weighted	Median maize volume (qq/year)			Price applied (Q/qq)
Market Position Distribution
Survey-weighted, threshold epsilon = 5%
Market position	N (raw)	N (weighted)	% weighted	Sold	Purchased	Household	Price applied (Q/qq)
Net seller	2,484	255,222	32.6%	6.31	0.00	11.45	192.5
Net buyer	2,370	250,388	32.0%	0.00	19.48	8.49	209.1
Autarkic	2,575	277,864	35.5%	0.00	0.00	14.29	200.8
Source: ENCOVI 2023 modules 13A (food consumption) and 16B (agricultural production), MAGA-calibrated. Threshold epsilon = 5% of total maize volume defines functional zero for sale and purchase shares.

Table 5: Market Position Distribution by Farmer Segment

Market Position by Farmer Segment. % within each segment (survey-weighted)
Segment	Net seller	Net buyer	Autarkic
Market Position by Farmer Segment
% within each segment (survey-weighted)
OPV/Criollo	28.5%	33.9%	37.6%
Low	44.7%	26.9%	28.4%
Mid	41.6%	24.8%	33.7%
High	47.4%	26.0%	26.6%
Source: ENCOVI 2023, MAGA-calibrated. Rows sum to 100% (within-segment shares).

Why Market Position Matters

The differential pricing applied to self-consumption is the bridge between observed market behavior and economic valuation. Net sellers, net buyers, and autarkic households each face a distinct opportunity cost for their own consumed maize: sale price (foregone revenue), purchase price (avoided expenditure), or shadow price (price-band midpoint). Without this classification, all self-consumption would be valued at a single price and the heterogeneity across segments would be lost.

Current Economic Baseline

Establish the economic situation under the current seed technology, segment by segment. This baseline is the counterfactual against which biofortified adoption is compared.

Current Economic Situation by Segment

Table 6: Current Economic Situation by Farmer Segment

Current Economic Situation by Farmer Segment. Survey-weighted medians (Q) under current seed technology
Segment	Farmers (N)	% Sellers	Income Components (Q)			Costs (Q)		Net Income	% Positive
Current Economic Situation by Farmer Segment
Survey-weighted medians (Q) under current seed technology
Segment	Farmers (N)	% Sellers	Sales	Self-Consumption¹	Gross Value	Seeds	Other Inputs	Net Income	% Positive
OPV/Criollo	594,812	21.4%	0	2,737	3,265	61	1,000	1,864	85.8%
Low	32,354	37.5%	262	3,182	4,320	238	1,700	2,331	88.8%
Mid	44,169	37.4%	190	3,006	4,046	244	1,550	1,501	77.9%
High	112,140	41.0%	305	2,761	4,271	279	1,915	2,058	85.7%
¹ Self-consumption is valued using the household-specific market-position price: sale price for net sellers, purchase price for net buyers, and the shadow price for autarkic households.
Source: ENCOVI 2023 (MAGA-calibrated). Seed costs are modeled by segment from Semilla Nueva refined prices (Q/mz × maize area) rather than taken from reported household seed expenditure (`exp_seeds`).

Subsistence Dominance Pattern

A consistent pattern across all segments is that self-consumption dominates revenue from sales. Even among segments with the highest market participation, retained production for household consumption typically exceeds sold production. This pattern reflects the subsistence orientation of Guatemalan smallholder maize farming.

Aggregate National Value

Table 7: Aggregate Economic Value of White Maize Production

Aggregate Economic Value of White Maize Production. National totals under current seed technology (Guatemala, 2023)
Metric	Value	% of Gross
Aggregate Economic Value of White Maize Production
National totals under current seed technology (Guatemala, 2023)
Production Base
Total Farmers	783,474
Total Land (mz)	1,651,732 mz
Total Production (qq)	45,760,490 qq
Gross Value
Revenue from Sales	Q 1,703,942,730	18.2%
Value of Self-Consumption	Q 7,663,501,376	81.8%
Total Gross Value	Q 9,367,444,106
Costs
Seed Costs	Q 220,325,078
Other Input Costs	Q 1,715,055,024
Total Costs	Q 1,935,380,102
Net Result
Net Income (National)	Q 7,432,064,004
Source: ENCOVI 2023 (MAGA-calibrated). Self-consumption is valued using the household-specific market-position price: sale price for net sellers, purchase price for net buyers, and the shadow price for autarkic households.

Projected Economic Situation with Biofortified Seed

Calculate the projected economic situation under biofortified seed adoption, applying segment-specific yield changes and the biofortified seed prices that correspond to the current subsidy regime.

Projected Changes by Segment

Table 8: Projected Changes in Production and Costs by Segment

Projected Changes with Biofortified Seed Adoption. Production, seed costs, and sales quantity by segment — 2022 Seed, Current subsidy
Segment	Farmers	Production (qq/farmer)			Seed Cost (Q/farmer)			Quantity Sold (qq/farmer)
Projected Changes with Biofortified Seed Adoption
Production, seed costs, and sales quantity by segment — 2022 Seed, Current subsidy
Segment	Farmers	Current	Projected	Change	Current	Projected	Change	Current	Projected	Change
OPV/Criollo	594,812	57.2	75.3	31.6%	147	737	590	7.3	25.4	18.1
Low	32,354	74.0	93.0	25.6%	534	534	0	12.3	31.3	19.0
Mid	44,169	95.5	97.2	1.8%	860	537	−322	14.5	16.2	1.7
High	112,140	45.5	39.2	−13.8%	690	216	−474	20.1	15.8	−4.3
Source: ENCOVI 2023 (MAGA-calibrated). Yield factors from Semilla Nueva yield data and market analysis; seed prices from refined seed and subsidy values.

Projected Economic Situation by Segment

Table 9: Projected Economic Situation by Farmer Segment

Projected Economic Situation by Farmer Segment. Survey-weighted medians (Q) under biofortified seed technology — 2022 Seed, Current subsidy
Segment	Farmers (N)	Income Components (Q)			Costs (Q)		Net Income	% Positive
Projected Economic Situation by Farmer Segment
Survey-weighted medians (Q) under biofortified seed technology — 2022 Seed, Current subsidy
Segment	Farmers (N)	Sales	Self-Consumption¹	Gross Value	Seeds	Other Inputs	Net Income	% Positive
OPV/Criollo	594,812	1,217	2,737	4,186	304	1,000	2,555	87.3%
Low	32,354	1,543	3,182	5,188	238	1,700	3,187	88.7%
Mid	44,169	267	3,006	4,085	152	1,550	1,714	77.6%
High	112,140	0	2,569	3,461	87	1,915	1,660	81.1%
¹ Self-consumption is valued using the household-specific market-position price: sale price for net sellers, purchase price for net buyers, and the shadow price for autarkic households.
Source: ENCOVI 2023 (MAGA-calibrated). Biofortified seed price applies the current subsidy regime.

Current vs Projected Comparison

Table 10: Economic Comparison: Current vs Biofortified Adoption

Economic Impact: Current vs Biofortified Seed. Net income comparison by farmer segment — 2022 Seed, Current subsidy (survey-weighted medians)
Segment	Farmers	Net Income (Q)				% with Positive Income
Economic Impact: Current vs Biofortified Seed
Net income comparison by farmer segment — 2022 Seed, Current subsidy (survey-weighted medians)
Segment	Farmers	Current	Projected	Change (Q)	Change (%)	Current	Projected	Change
OPV/Criollo	594,812	1,864	2,555	691	37.1%	85.8%	87.3%	1.5%
Low	32,354	2,331	3,187	856	36.7%	88.8%	88.7%	−0.1%
Mid	44,169	1,501	1,714	213	14.2%	77.9%	77.6%	−0.3%
High	112,140	2,058	1,660	−399	−19.4%	85.7%	81.1%	−4.5%
Source: ENCOVI 2023 (MAGA-calibrated). Impact calculated as projected minus current situation.

Subsidy Benefit Calculation

Quantify the monetary value of the seed subsidy received by each farmer under the current regime. The framework distinguishes five complementary measures, all derived from the per-area prices declared in subsidy_variants.yml:

Measure	Interpretation
`subsidy_amount_absolute`	Absolute monetary value of the subsidy received, computed against the unsubsidized commercial reference price (547 Q/mz) and scaled by area planted.
`subsidy_reduction_cost`	Additional out-of-pocket cost the farmer absorbs when a subsidy regime reduces the subsidy below the current regime. Zero under the current regime by construction.
`newseed_subsidy`	Semilla Nueva’s per-area direct financial commitment under the active regime, scaled by area planted.
`producer_absorption`	Share of the absolute subsidy value covered by the local seed producer (intermediary) via improved producibility. Zero under the current regime by construction.
`newseed_savings_vs_current`	Reduction in Semilla Nueva’s per-farmer financial commitment when moving from the current regime to an alternative regime. Zero under the current regime by construction.

Two identities hold by construction:

Absolute subsidy decomposition — subsidy_amount_absolute = newseed_subsidy + producer_absorption. The total per-farmer subsidy value is jointly funded by Semilla Nueva (direct subsidy) and the local seed producer (improved producibility absorption). The farmer’s out-of-pocket cost is not part of the subsidy by definition.
Reallocation of the Semilla Nueva saving — newseed_savings_vs_current = producer_absorption + subsidy_reduction_cost. When Semilla Nueva reduces its commitment, the freed amount is reallocated between the local producer (who absorbs part via improved producibility) and the farmer (who pays the rest out of pocket).

Subsidy Benefit by Segment

Table 11: Subsidy Benefit by Farmer Segment

Subsidy Benefit by Farmer Segment. Survey-weighted statistics (Q/farmer) — 2022 Seed, Current subsidy
Segment	Farmers (N)	Absolute subsidy value (Q)			Reduction cost vs current (Q)
Subsidy Benefit by Farmer Segment
Survey-weighted statistics (Q/farmer) — 2022 Seed, Current subsidy
Segment	Farmers (N)	P25	Median	P75	P25	Median	P75
OPV/Criollo	594,812	115	241	484	0	0	0
Low	32,354	86	189	264	0	0	0
Mid	44,169	56	121	242	0	0	0
High	112,140	26	69	234	0	0	0
Absolute value: subsidy received relative to the unsubsidized reference price (547 Q/mz). Reduction cost: additional cost the farmer absorbs vs the current regime (zero by construction under the baseline regime).

National Subsidy Totals

Table 12: National Subsidy Totals

National Subsidy Totals. Population-weighted aggregates — 2022 Seed, Current subsidy
Metric	Value
National Subsidy Totals
Population-weighted aggregates — 2022 Seed, Current subsidy
Total Farmers	783,474
Total Land (mz)	1,651,732 mz
Subsidy Value (Absolute)	Q 399,719,192
Reduction Cost vs Current Regime	Q 0
Total Seed Cost Paid by Farmers	Q 503,778,320
Reference unsubsidized biofortified price: 547 Q/mz. Reference current-regime biofortified price: 305 Q/mz.

Subsidy Cost Decomposition by Actor

Table 13: Subsidy Cost Decomposition by Actor

Subsidy Cost Decomposition by Actor. Population-weighted aggregates — 2022 Seed, Current subsidy
Metric	Value
Subsidy Cost Decomposition by Actor
Population-weighted aggregates — 2022 Seed, Current subsidy
Total Land (mz)	1,651,732 mz
Total Subsidy Value (absolute)	Q 399,719,192
NewSeed direct subsidy	Q 399,719,192
Local seed producer absorption	Q 0
Farmer extra cost vs current	Q 0
NewSeed Savings vs Current Regime	Q 0
NewSeed share of subsidy	100.0%
Producer share of subsidy	0.0%
Total Subsidy Value is jointly funded by Semilla Nueva (direct subsidy) and the local seed producer (improved producibility absorption); both shares sum to 100%. Farmer extra cost and Semilla Nueva Savings vs Current Regime are reported separately: the farmer’s out-of-pocket cost is not part of the subsidy by definition, and Semilla Nueva’s savings equal the producer absorption plus the farmer extra cost. All three are zero under the current regime by construction.

Economic Impact Analysis

Consolidate the per-farmer economic impact (projected minus current) into population-level distributions and benefit-source decomposition.

Impact Distribution by Segment

Table 14: Economic Impact Distribution by Farmer Segment

Economic Impact Distribution by Farmer Segment. Classification based on net income change — 2022 Seed, Current subsidy (±50 Q threshold)
Segment	Farmers	Impact Category (%)			Net Income Increment (Q)
Economic Impact Distribution by Farmer Segment
Classification based on net income change — 2022 Seed, Current subsidy (±50 Q threshold)
Segment	Farmers	Winners	Losers	Neutral	Mean	Median
OPV/Criollo	594,812	84.0%	12.0%	4.0%	2,312	687
Low	32,354	89.7%	8.5%	1.8%	4,161	1,069
Mid	44,169	70.4%	20.7%	8.9%	1,538	191
High	112,140	23.3%	70.1%	6.7%	−297	−260
Winners: Net income increment > 50 Q. Losers: Net income increment < -50 Q. Neutral: Within ±50 Q.

Benefit Source Decomposition

Table 15: Decomposition of Economic Benefit by Source

Decomposition of Economic Benefit by Source. Survey-weighted mean contribution to net income change — 2022 Seed, Current subsidy (Q/farmer)
Segment	Farmers	Benefit Source (Q)			Total Benefit
Decomposition of Economic Benefit by Source
Survey-weighted mean contribution to net income change — 2022 Seed, Current subsidy (Q/farmer)
Segment	Farmers	Sales Change	Self-Consumption	Seed Savings	Total Benefit
OPV/Criollo	594,812	2,902	0	−590	2,312
Low	32,354	4,161	0	0	4,161
Mid	44,169	1,216	0	322	1,538
High	112,140	−368	−403	474	−297
Sales Change: Δ(qty_sold × price_sale). Seed Savings: −(cost_bio − cost_conv). Self-Consumption: Δ(qty_retained × price_self_consumption); minimal change since household needs are fixed.

Benefit Source Heterogeneity

The economic mechanism differs by segment. For the non-hybrid segment, yield-driven sales gains carry the benefit: 2,902 Q/farmer against a seed cost that rises by 590 Q/farmer, since these farmers move from near-zero seed expenditure to the biofortified price. The Low and Mid segments follow the same pattern, with sales gains of 4,161 and 1,216 Q/farmer.

The High segment is the one where the sign reverses. Its sales contribution is negative, at −368 Q/farmer, and only the seed cost saving of 474 Q/farmer is positive. Self-consumption is the third component: it is effectively zero in the first three segments, where household needs are met either way, and −403 Q/farmer in the High segment, where the yield reduction of 13.8% eats into the quantity retained for the household.

National Impact Summary

Table 16: National Economic Impact Summary

National Economic Impact Summary. Population-weighted aggregates — 2022 Seed, Current subsidy
Metric	Value
National Economic Impact Summary
Population-weighted aggregates — 2022 Seed, Current subsidy
Population
Total Farmers	783,474
Winners (>50 Q gain)	585,710
Losers (>50 Q loss)	161,772
Neutral (±50 Q)	35,993
Production
Current Production	45,760,490 qq
Projected Production	56,504,051 qq
Production Change	10,743,560 qq
Income
Current Net Income	Q 7,432,064,004
Projected Net Income	Q 8,976,244,517
Total Income Impact	Q 1,544,180,513
Costs
Current Seed Costs	Q 220,325,078
Projected Seed Costs	Q 503,778,320
Seed Cost Change	Q 283,453,242

Distribution Analysis

Examine the distribution of economic impacts across the farmer population to characterize variability and identify edge cases.

Net Income Increment Distribution

Table 17: Net Income Increment Distribution by Segment

Net Income Increment Distribution by Segment. Statistical summary of economic impact — 2022 Seed, Current subsidy (Q/farmer)
Segment	N	Central Tendency		Std Dev	Percentiles				Extremes
Net Income Increment Distribution by Segment
Statistical summary of economic impact — 2022 Seed, Current subsidy (Q/farmer)
Segment	N	Mean	Median	Std Dev	P5	P25	P75	P95	Min	Max
OPV/Criollo	5,627	3,642	733	19,758	−486	234	2,217	17,652	−110,110	389,646
Low	313	4,984	1,089	16,272	−379	528	2,343	15,270	−21,629	95,142
Mid	411	3,070	185	28,579	−1,413	2	674	3,250	−12,377	547,005
High	1,078	−515	−278	5,915	−4,302	−776	29	1,859	−31,496	176,473
P5/P95: 5th and 95th percentiles. Large spread indicates high variability in outcomes.

Edge Cases and Limitations

Table 18: Edge Cases and Limitations

Edge Cases and Limitations. Identification of unusual cases for interpretation
Edge Case	Records	Farmers (N)	Implication	% of Total
Edge Cases and Limitations
Identification of unusual cases for interpretation
Zero production farmers	83	9,395	Excluded from impact calculation (no production to change)	1.20%
Production-limited self-consumption	594	60,817	Self-consumption capped at available production (High segment)	7.76%
Extreme positive impact (>10,000 Q)	715	65,120	Large-scale farmers with high production gains	8.31%
Extreme negative impact (<-10,000 Q)	76	8,395	Large-scale farmers with high production losses or costs	1.07%
Income sign change: negative → positive	263	27,265	Farmers transitioning to profitability with biofortified	3.48%
Income sign change: positive → negative	212	23,645	Farmers losing profitability (primarily High segment)	3.02%
Note: Edge cases with >1% of population highlighted. These may warrant additional scrutiny.

Summary

Counterfactual Framework

The economic impact model compares, for each farmer, the current situation (existing seed technology) against the projected situation (biofortified seed). The difference is the per-farmer net income increment, which aggregates into national-level outcomes via survey weights.

Key Findings

Segment-differentiated outcomes — Yield increases concentrate in the lower-technology segments, at +31.6% for non-hybrid and +25.6% for Low, while seed cost savings concentrate in the higher ones, at 183 and 671 Q/mz for Mid and High. The net income increment changes sign across segments: positive for the first three, at a mean of 2,312, 4,161 and 1,538 Q/farmer, and negative for High at −297 Q/farmer.
Subsistence orientation — Retained production exceeds marketed production even among net sellers, whose median is 11.5 qq kept against 6.3 qq sold, so the value of self-consumption carries most of the economic position of these households.
Market position matters — The three positions are close to evenly split, at 32.6% net sellers, 32.0% net buyers and 35.5% autarkic. Pricing self-consumption at the sale, purchase or shadow price according to position is therefore material to the aggregate, and a uniform price would flatten it.
Subsidy decomposition — Under the current regime the subsidy is funded entirely by Semilla Nueva, at 242 Q/mz of direct commitment, with no producer subsidy absorption and no extra cost to the farmer. Alternative regimes move that burden between the three actors.

Limitations

Non-seed input costs assumed constant — biofortified varieties do not require different agronomic practices, but actual field experience may show modest deviations.
Self-consumption needs assumed fixed — household maize requirements respond to family size and food security context, not to seed technology.
Price reference points are population medians — segment-specific price differentiation (e.g., quality premiums) is not modeled.