Saturday, December 3, 2011

The Evolving Impact of the Ogallala Aquifer: Agricultural Adaptation to Groundwater and Climate 
Agriculture on the American Great Plains has been constrained by historical water scarcity. After World War II, technological improvements made groundwater from the Ogallala aquifer available for irrigation. Comparing counties over the Ogallala with nearby similar counties, groundwater access increased irrigation intensity and initially reduced the impact of droughts. Over time, land-use adjusted toward water-intensive crops and drought-sensitivity increased; conversely, farmers in water-scarce counties maintained drought-resistant practices that fully mitigated higher drought-sensitivity. Land values capitalized the Ogallala's value at $26 billion in 1974; as extraction remained high and water levels declined, the Ogallala's value fell to $9 billion in 2002.

by Richard Hornbeck and Pinar Keskin
National Bureau of Economic Research (NBER)
NBER Working Paper No. 17625; Issued in November 2011

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