This paper introduces an econometric technique to analyze the factors affecting the land shares of alternative irrigation technologies in agriculture. It estimates the likelihood of use of drip, sprinkler, and surface irrigation by fruit growers in the Central Valley of California. Higher water costs, the use of groundwater, the production of nuts, and location are found to increase the likelihood of using drip and sprinkler irrigation. The results are used to demonstrate the effectiveness of water price increases in inducing water conservation.

This paper introduces a framework to study the effects of farm characteristics (land quality and well depth) and irrigation technology characteristics (application effectiveness and pressurization requirement) on a farmer's choice of irrigation system. Conditions indicating how the adoption of drip or sprinkler irrigation affects water and energy demands are presented as well as conditions under which these technologies are likely to be adopted. Two functional forms for the production function (quadratic and Cobb‐Douglas) are presented with realistic values of key parameters. The empirical analysis demonstrates the importance of using forms which are consistent with the classical three stages of production.

A general model of adoption of input‐conserving technologies by competitive firms is introduced using drip irrigation as an example. An environmental regulation such as a drainage effluent charge is shown to influence adoption. Early adopters are likely to be producers with less efficient fixed assets (land of low quality or antiquated capital), higher input costs (higher water prices or greater depth to groundwater), and in more environmentally sensitive regions. Simulations show that drainage regulations can be expected to play a major role in adoption of more efficient irrigation technologies in California. Thus, conservation may be a key to solving resource scarcity problems and reducing external environmental costs.

Of the twelve million people who live within 100 km of the US-Mexico border, 90 percent are clustered in transboundary sister cities that share common water sources and pollution problems. New institutions created to address environmental concerns over NAFTA offer the promise of greater financial and technical assistance for water management in border cities. This paper reviews US-Mexico border water issues and institutions. Using insights from game theory, it draws policy lessons for institutions funding border water projects. We examine how the design of assistance programs, technical support, and pre-existing water rights and regulations affect project outcomes. The diversity and geographic dispersion of water conflicts suggests potential for applying the interconnected game approach to US-Mexico water negotiations. 0 2000 Elsevier Science B.V. All rights reserved.