Examining the effects of absorptive capacity and social capital on the adoption of agricultural innovations: A Canadian Prairie case study

Previous research on agricultural innovation has focused on the role farm-level characteristics have with respect to rate of innovation adoption. While these studies often account for the effects of readily measureable farm characteristics (such as farm size or managerial experience) on innovation, they have been silent on the role that organizational resources play in this decision. The objective of this research is to analyse the role that critical organizational resources such as social capital, knowledge networks, and absorptive capacity have on innovation adoption rates for Canadian grain and livestock farms. In the analysis, we also account for measurable farm-level characteristics to help better isolate organizational resource effects on the rate of innovation adoption in the sector. Using a survey of farmers across the provinces of Saskatchewan, Alberta, and Manitoba, we find that the ability to assimilate and integrate information on products and processes and the degree to which firms are integrated into formal and informal knowledge networks has a significant effect on the rate at which agricultural innovations get adopted.