Understanding the Drivers of Agricultural Innovation in Ethiopia’s Integrated Agro-Industrial Parks: A Structural Equation Modeling and Qualitative Insights Approach

Efa Muleta Boru (), Junseok Hwang and Abdi Yuya Ahmad
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Efa Muleta Boru: Department of Technology and Innovation Management, Adama Science and Technology University, P.O. Box 1888 Adama, Ethiopia
Junseok Hwang: Department of Technology Management, Economics, and Policy Program, School of Engineering, Seoul National University (SNU), Gwanak-ro, Gwanak-gu, Seoul 08826, Republic of Korea
Abdi Yuya Ahmad: Department of Technology and Innovation Management, Adama Science and Technology University, P.O. Box 1888 Adama, Ethiopia

Agriculture, 2025, vol. 15, issue 4, 1-26

Abstract: Ethiopia’s agricultural sector faces several challenges, including low productivity, limited technology adoption, and vulnerability to climate change. Integrated Agro-Industrial Parks (IAIPs) have been designed to address these issues by linking agriculture with industrialization and encouraging the adoption of advanced technologies. However, the role of IAIPs in driving agricultural innovation has not been thoroughly explored. This study employs the Sectoral Innovation Systems (SIS) framework combined with Structural Equation Modeling (PLS-SEM) and qualitative insights to identify the key drivers of agricultural innovation within Ethiopia’s IAIPs. The key drivers analyzed include institutional support, networking, policy frameworks, technology adoption, and gender dynamics. Data were collected from a range of stakeholders, including government agencies, research institutions, agro-businesses, and local communities with direct linkages to two of Ethiopia’s four IAIPs. The findings highlight the crucial role of institutional support and networking in fostering innovation, with government policies significantly influencing technological advancements. Additionally, qualitative insights underscore the potential of circular economy principles—such as waste management and byproduct recycling—towards improving sustainability and economic efficiency within IAIPs. Based on these findings, the study recommends strengthening institutional frameworks, promoting greater stakeholder collaboration, and integrating technological innovations as key strategies for enhancing agricultural innovation. Future research should expand to include a broader range of IAIPs and investigate the long-term effects of innovation systems through both quantitative and qualitative approaches.

Keywords: agricultural innovation; integrated agro-industrial parks; PLS-SEM; institutional support; technology adoption; circular economy (search for similar items in EconPapers)
JEL-codes: Q1 Q10 Q11 Q12 Q13 Q14 Q15 Q16 Q17 Q18 (search for similar items in EconPapers)
Date: 2025
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