Water Demand Elasticity in Agriculture: The Case of the Central Emilia Irrigation Water District

We estimated the water demand elasticity through an econometric approach applied to a large dataset of water demand observations for an irrigation water district in the Emilia-Romagna region (Italy). Elasticity has been estimated also by considering subsamples of crops and irrigation technologies. The results show water demand inelastic to price, with heterogeneity among crops and irrigation systems. More precisely, we find higher levels of water demand responsiveness for efficient irrigation systems (drip and sprinkler) than for traditional irrigation technologies such as furrow systems. In the paper we provide various potential interpretations to this heterogeneity among crops and irrigation systems.