International Journal in Management & Social Science
Year : 2014, Volume : 2, Issue : 1
First page : ( 115) Last page : ( 129)
Online ISSN : 2321-1784.

Economic valuation of irrigation water: Evidence from lower Moshi irrigation Scheme in Tanzania

Bongole Abiud January

School of Business Studies and Economics, University of Dodoma, Tanzania

Online published on 7 June, 2014.

Abstract

Water scarcity is globally getting worse in the light of increase in demand for water use. Human and ecosystem health and economic development are affected by problems of water scarcity and water pollution. This article assessed the economic value of irrigation water in crop production around the Lower Moshi Irrigation Scheme in Tanzania. Specifically, the study determines and estimates economic value of paddy and maize using Residual Imputation Method while the Change in Net Income Approach was used to compute the net output values. Household questionnaires, checklist for key informants and participant observation were employed for data collection. Questionnaire survey was administered to 105 households to establish the major agricultural activities, crops, costs of production and income accrued from these activities. Data relating to household characteristics and water related economic activities were analysed using LiMDEP 12 statistical software whereby Microsoft Excel was employed to analyze data and quantify benefits accumulated from water (returns). Findings revealed that, 78.3 percent of the respondents own land and 21.7 percent of them rent the land for crop production. The net values of water for irrigated paddy and maize were estimated to Tshs 661.2 (US$ 0.413 per m³) and Tshs 329.25 (US$ 0.21 per m³) respectively. Furthermore, the results indicated that, the more profitable enterprise is irrigated paddy with a profit margin per Ha of Tshs 2,467,611, followed by maize with a profit margin per Ha of Tshs 742,450.

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Keywords

Value of Water, Residual Imputation Method, Paddy, Maize.

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