Institutional change and smallholder innovation: an example from the Portuguese dairy sector

The process of adoption of new technologies by small farmers has been a traditionally important topic of research in agricultural development. The nature of farmer decision making is seen as a critical factor in determining the speed of diffusion of new technologies among smallholders and the consequent distribution of the benefits of technical change. This article uses the example of northwest Portugal, a smallholder region that has experienced significant change over the last 2 decades, to illustrate the case where institutional innovation preceded small farmer adoption of a new technology. Specifically, the article analyzes the impact of major agricultural policy changes on representative dairy technologies in order to explain the rapid spread of technical change among smallholders in this region. -from Authors