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Adoption of New Irrigation Technology Under Production Risk

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  • Javad Torkamani
  • Shahrokh Shajari

Abstract

This paper investigates the factors affecting adoption of new irrigation technologies and also addresses the linkage between this type of technology and production risk. The risk-premium associated with the use of water is estimated by adapting a moment-based approach. Farm-level data were collected from a sample of 187 wheat farms, located in the three major districts of Fars province of Iran during the years 2002 and 2003. Results of this study demonstrate that the risk premium decrease with new irrigation technology. Also, it is concluded that the farmer-specific relative risk premium has positive and significant effect on the decision to adopt the new irrigation technologies. So, farmers that are more risk-averse with respect to their use of water are more likely to adopt new irrigation technologies that allow them to save water and decrease their production (yield) risk. Copyright Springer Science+Business Media, Inc. 2008

Suggested Citation

  • Javad Torkamani & Shahrokh Shajari, 2008. "Adoption of New Irrigation Technology Under Production Risk," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 22(2), pages 229-237, February.
    • Handle: RePEc:spr:waterr:v:22:y:2008:i:2:p:229-237
    DOI: 10.1007/s11269-007-9154-3
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    4. César Salazar & John Rand, 2016. "Production risk and adoption of irrigation technology: evidence from small-scale farmers in Chile," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 25(1), pages 1-37, December.

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