Does investment in irrigation technology necessarily generate rebound effects? A simulation analysis based on an agro-economic model

Investing in more efficient irrigation technology is usually regarded as a means to reduce the use of water by irrigated agriculture. However, some authors report that the introduction of irrigation systems that apply water more uniformly may actually increase water catchment depletion: the so-called ‘rebound effect’. In this paper a simple model that combines irrigation, agronomic, and microeconomic concepts is used to systematically analyze the conditions under which improved irrigation application uniformity may lead to increased water use and/or consumption. The analysis is illustrated with examples from the experience with irrigation modernization in Spain. Water demand (the value of marginal water productivity) becomes inelastic as the irrigation application uniformity increases. The increase in water depletion due to the introduction of more uniform irrigation systems is insignificant if land is limited and farmers optimize their profit. If land is not a limiting factor, new water abstractions are likely to occur, potentially leading to a vicious circle in which irrigated land expands while water resources become overexploited. This cycle tends to slow down as irrigation application uniformity increases. More accurate water accounting is suggested as an instrument for controlling water depletion complementary to investing in irrigation efficiency when water conservation at the basin scale is the main objective.