In the context of agro-ecological transition, our paper develops an empirical framework to investigate the multidirectional relationships in the nexus of innovativeness - adoption capacity - technical efficiency. We use a conditional efficiency framework and a two-stage structural Generalized Probit model on a sample of 567 Caribbean banana farms to test for these multidirectional relationships. First, our estimates provide evidence for the bi-directional relationship between the adoption capacity of the farm and its technical efficiency, as we find that when higher adoption capacity increases technical efficiency, farms close to the production frontier are in turn more likely to improve their capacity to adopt complementary innovations to reach the frontier. Second, our results show that farmer innovativeness has a positive and direct effect mainly on the adoption capacity of the farm. Its effect on technical efficiency is indirect through the positive effect of adoption capacity. Third, our results highlight the impact of farm training and social networking through extension services and commercial relationships with value chain stakeholders. These levers increase the adoption capacity of the farm by transforming, assimilating, and applying new ideas for commercial purposes.
