The Implicit Value of Irrigation Through Parcel Level Hedonic Price Modeling

This paper relies on data associated 2,100 agricultural land sale transactions across two major Nebraska Watersheds (the Republican and Central Platte) over the 2000 to 2008 time period. The sales were spatially referenced (digitized into a GIS) in order to quantify and geo-spatially predict and map the implicit values of irrigation through the use of hedonic price modeling. Marginal implicit prices vary substantially across subwatersheds (natural resource districts), and the contribution of irrigation to sale prices is directly related to the extent to dependency of production agriculture on irrigation. This information is now currently being used to evaluate the economic efficiency of recent irrigation retirement programs and to help ensure that current and future retirement programs are cost-effective through targeting that retires irrigation land with the greatest hydrologic impact on water resources for the lowest cost.