We focus our study on the agrarian transition in Lao People’s Democratic Republic (Lao PDR), a
country overwhelmingly dependent on agriculture. Close to 80% of a population lives in rural areas and
most are near-subsistence farmers engaged in rice-based agriculture. The large role agriculture plays can
hardly be overlooked. Given the paucity of evidence, this paper provides a research on the determinants of
agricultural efficiency and rural development by analyzing the marked differences between the upland and
the lowland farming of the country.
Our original contribution is to explore the association between farmer education and the adoption
of modern agricultural practices in Lao PDR. We find that the returns to farmer education are strongly
positive, particular for a completion of primary cycle. Moreover, a better educated farmer is more likely to
use new technology, and to have market access and off-farm activities. Despite the large public investment
in irrigation, its role is very limited. The research suggests that the support policy on farmer education will
be decisive not only for the success of the agrarian transition process but also the long term development of
the country