Does Technology Adoption Improve Agricultural Productivity? Evidence from Smallholder Arabica Coffee Farming in Indonesia

This study seeks to explain how structural factors, farmers’ capacity, technology adoption, and market orientation jointly shape productivity in smallholder Arabica coffee farming. Primary data were collected from 152 Arabica coffee farmers in Kerinci Regency, Jambi Province, Indonesia, between June and August 2025 and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The results show that infrastructure and government policy have positive and significant effects on technology adoption. However, infrastructure does not directly affect productivity, whereas government policy shows a negative, significant effect on productivity, suggesting a possible misalignment between policy support and farmers’ practical production needs. In contrast, digital literacy and market orientation are found to be the main determinants that significantly enhance productivity. Technology adoption does not have a significant effect, either directly or as a mediating variable, suggesting a gap between adoption and utilization at the farm level. The moderation analysis reveals that market orientation strengthens the relationship between digital literacy and productivity. Overall, these findings emphasize that productivity improvement is not solely determined by technology, but is more strongly influenced by farmers’ capacity and market orientation.