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Irrigation Technology Adoption Under Factor Price Uncertainty: Groundwater- Irrigated Production in Nebraska, 1960 -- 2005

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  • Savage, Jeff
  • Brozovic, Nicholas

Abstract

The development of groundwater-irrigated production technologies, fed by water from the Ogallala Aquifer, facilitated the development of agriculture in the High Plains region of the United States that began during the 1960s. The current rate of pumping for irrigation in the region is causing the aquifer to be depleted in many areas, which is cause for concern from a socioeconomic and environmental standpoint. The goal of this paper is to assess the factors that affect the decision to adopt groundwater-irrigated production by farmers, in the presence of risk differentiated by heterogeneous farmland quality and groundwater depth. A binary choice model of adoption is estimated for Nebraska, from 1960 – 2005. The results suggest that farmers consider climate variability, revenue potential, and potential pumping costs in the investment decision.

Suggested Citation

  • Savage, Jeff & Brozovic, Nicholas, 2009. "Irrigation Technology Adoption Under Factor Price Uncertainty: Groundwater- Irrigated Production in Nebraska, 1960 -- 2005," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49585, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea09:49585
    DOI: 10.22004/ag.econ.49585
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    Cited by:

    1. Mani Rouhi Rad & Taro Mieno & Nicholas Brozović, 2022. "The Role of Search Frictions and Trading Ratios in Tradable Permit Markets," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 82(1), pages 101-132, May.

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    Keywords

    Crop Production/Industries; Research and Development/Tech Change/Emerging Technologies;

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