Potential Regional Economic Impacts of Water Cutbacks to Irrigated Agriculture

Abstract

This study presents results from two previous case studies (Bickel et al., 2019, 2020) that estimate the potential regional economic impacts of agricultural water supply cuts to two crop producing regions in Arizona: (1) Pinal County and (2) Graham and Greenlee counties. These two regions represent areas of the state with relatively high probabilities of surface water shortages which could trigger cutbacks to agriculture. Assuming that producers would respond to cutbacks by fallowing land, or taking it out of production, the studies estimated reductions in acreage, farm gate sales, farmer income, as well as the resulting economic multiplier effects from farmers purchasing fewer inputs from local businesses and employing fewer farm workers.