A bioeconomic simulation analysis of irrigation investments.

Abstract

Assesses the impact of variations in weather patterns on the profitability of irrigation investments in humid regions. Cumulative probability functions of the net present value of investing in four alternative irrigation systems for irrigating these alternative crops are calculated. Irrigation reduces production risk but irrigation investment increases financial risk. The net effect on risk depends on the specific situation and weather. Most helpful is sufficient information for farmers to evaluate the probability of making a 'successful' investment. Bioeconomic simulation models provide that capability.-from Authors