Abstract
This paper applies ex ante econometric, cost–benefit, and financial methodologies to increase participation in an irrigation project and predict its financial feasibility and social sustainability in Shahrazoor, Kurdistan, Iraq. I investigated the socio-economic, psycho-cultural, and financial factors that determine participation. The socio-economic part of the econometric analysis showed that the project was appreciated more by poorer and economically weaker farmers who rely on agriculture than by those who rely on livestock activities. The psycho-cultural part of the econometric analysis emphasized that the project was appreciated more by literate farmers who adopt a maximization (rather than habit) approach. The cost–benefit analysis applied to the irrigation project was tailored to poorer and weaker farmers (i.e., costs of the irrigation scheme and benefits from new cultivation patterns were defined with reference to small farms) by including indirect benefits from both irrigation (e.g., flood control) and hydropower (e.g., eliminated GHG emissions), and determined a 7.1% mean internal rate of return; this was affected more strongly by uncertainty in crop prices than by uncertainty in indirect benefits. The financial analysis highlighted values for water prices, financial returns, and loan rates that met government and farmer budgets. A single framework summarized the main relevant social, economic, and financial conditions, and, by including insights from sensitivity analyses, determined the feasibility and sustainability of the irrigation project. Provided that the water price charged to farmers is between 0.32 and 0.57 USD/m3, and the loan interest rate paid by farmers is smaller than 3.0%, the irrigation project in Shahrazoor is financially feasible for 13.6% of all reliable economic solutions and socially sustainable for 35.8% of the solutions.
Highlights
Agricultural policy programs, in general, and technological interventions in agriculture, in particular, should be congruent with farmer priorities and expectations, and should be appropriate for the long-term socioeconomic, cultural, and agronomic circumstances of the farmers ([1,2,3])
Technological interventions ([4,5,6,7,8,9,10,11]), in general, and irrigation projects ([12,13,14,15,16,17,18,19]), in particular, often result in a low level of awareness among the target group and in a low level of successful diffusion of the project because farmers are rarely consulted a priori about their specific circumstances, priority problems, and expectations
The present study focuses on the Qara Ali dam and irrigation project
Summary
Agricultural policy programs, in general, and technological interventions in agriculture, in particular, should be congruent with farmer priorities (i.e., the problems to be solved) and expectations, and should be appropriate for the long-term socioeconomic, cultural, and agronomic circumstances of the farmers ([1,2,3]). Kondoh and Jussaume [22] applied logistic regression analysis to estimate the relative impacts of social networks and life experiences on the willingness of farmers in Washington State (USA) to adopt genetically modified organisms They did not consider the psycho-cultural characteristics of the farmers or the technological features of the proposed interventions. Jaek and Lifran [23] performed a choice experiment to estimate the monetary value attached by farmers in France to six relevant attributes associated with rice cultivation practices, in order to design targeted contracts according to farmer preferences and to persuade the majority of rice growers to adopt environmentally friendly practices They did not perform a financial analysis to implement an effective policy based on differentiated payments
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