Fixed Effects Estimation of the Intensive and Extensive Margins of Irrigation Water Demand

Irrigation water demand is estimated using field-level panel data from Kansas over 16 years. The cost of pumping varies over time due to changes in energy prices and across space due to differences in the depth to water. Exploiting this variation allows us to estimate the demand elasticity while controlling for field-farmer and year fixed effects. Fixed effects also allow us to control for land use without an instrument or assumptions about the distribution of errors. Our estimates of water demand are used to calculate the cost of reducing irrigation water use through water pricing, irrigation cessation, and intensity-reduction programs.


Issue Date:
2012-04
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/122312
Published in:
Journal of Agricultural and Resource Economics, Volume 37, Number 1
Page range:
1-19
Total Pages:
19




 Record created 2017-04-01, last modified 2017-08-26

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