Risk-Efficient Irrigation Strategies for Wheat

Agricultural production is risky. When farmers are risk-averse, they are likely to put a premium on production methods that reduce perceived risks. Irrigation is generally believed to be a riskreducing input. By using the concept of stochastic dominance, risk-efficient irrigation policies for wheat grown in central India are identified and quantitative estimates of benefits due to risk reduction are obtained. Such benefits were found to be of a large order of magnitude. The more common methods such as mean variance analysis tended to over-estimate the benefits.