Document Type: Original Article


1 PhD Student of Agricultural Economics, University of Sistan and Baluchestan. Social and Economic Research Department, Sistan Agriculture and Natural Resources Research and Education Center, AREEO, Zabol, Iran

2 Associate Professor of Economics, University of Sistan and Baluchestan

3 Professor of Agricultural Economics, University Of Ferdowsi Mashhad


In this study, water management allocated to the agricultural sector’ was analyzed using stochastic dynamic programming under uncertainty conditions. The technical coefficients used in the study referred to the agricultural years, 2013-2014. They were obtained through the use of simple random sampling of 250 farmers in the region for crops wheat, barley, melon, watermelon and ruby grapes under the scenarios of drought, wet, normal, and water required in the most sensitive growth stages. Production function and profit function were obtained from the yield-water-product function of crops using Eviews software. Expected net profit of the system and optimal allocation of water were also calculated based on the GAMS economic analysis software. The results revealed that 14% of the cases over the past 30 years had wet years (high), 47% of the time and that 39% had experienced drought (low) and normal (average) years. In the best case, i.e. with high current levels, respectively at, 58, 67, 54, and 48% of water requirements for these crops and, in the worst case (with low current levels), 47, 35, 49, 53 and 48% of the water requirements provided during the most sensitive growth stages. Moreover, the results showed that the cultivation of the ruby grape was the best product with the highest expected profit in normal and rainfall conditions. In general, when the expected value of net profit is positive, managers would act optimistically and they would promise the optimal level of water provided to the farmers. Conversely, when the net value is negative they would prefer to be more conservative and would promise a lesser amount of water provided to the farmers. Hence, if the promised water to the farmer is not wasted, he will choose the loss incurred from a lesser harvest.

Graphical Abstract


Main Subjects

1- Abbott, M., & Cohen, B. (2009). Productivity and efficiency in the water industry. Utilities Policy, 17(3), 233-244.
2- Divakar, L., Babel, M. S., Perret, S. R., & Gupta, A. D. (2011). Optimal allocation of bulk water supplies to competing use sectors based on economic criterion– An application to the Chao Phraya River Basin, Thailand. Journal of Hydrology, 401(1), 22-35.
3- Dorfman, R. (1969). An economic interpretation of optimal control theory. The American Economic Review, 59(5), 817-831.
4- Ebrahimzade, E.,& Lashkaripoor, G. (2001). Drought crisis in Sistan and adjust its strategies. Political and Economic Ettelaat, 167(15),226-231
5- Ghaffari moghadam, Z., Keikhah , A., & Sabouhi, M. (2012). Optimum water resources allocation using game theory. Iran Water Resources Research, 8(2), 12-23.
6- Ghaffour, N., Missimer, T. M., & Amy, G. L. (2013). Technical review and evaluation of the economics of water desalination: current and future challenges for better water supply sustainability. Desalination, 309, 197-207.
7- Ghasemi, A., Ghasemi, M. M., & Pessarakli, M. (2012). Yield and yield components of various grain sorghum cultivars grown in an arid region. Journal of Food, Agriculture and Environment, 10(1), 455- 458.
8- Homauonifar, R & Rastgaripour, F. (2011). Latian Dam water allocation among crops in conditions of uncertainty. Journal of Economics and Agriculture Development, 24(2), 259-267.
9- Karim, M., ghasemi, M.M., Naroui, MR., & Koohkan, S. (2012). Effects of Yaghoti Grape Cultivation on Economy of Rural Families in Sistan and Baluchistan Province-Iran. International Journal of Agriculture and Crop Sciences, 4(7), 386-389.
10- Kessler, J. J., & Van Dorp, M. (1998). Structural adjustment and the environment: the need for an analytical methodology. Ecological Economics, 27(3), 267-281.
11- Lynch, H. J., Campbell Grant, E. H., Muneepeerakul, R., Arunachalam, M., RodriguezIturbe, I., & Fagan, W. F. (2011). How restructuring river con-171 nectivity changes freshwater fish biodiversity and biogeography. Water Resources Research, 47(5).
12- Mahan, R. C. (1997). Efficient allocation of surface water resources in southern Alberta. University of Calgary.
13- Mahan, R.C., Horbulykb, TM., & Rowse, JG .(2002). Market mechanisms and the efficient allocation of surface water resources in southern Alberta. Socio-Economic Planning Sciences, 36(1), 25-49.
14- Mihankhah , N, Chizari , A.H & Khalilian , S. (2013). Optimum operational management from surface water resources with an application of dynamic programming. Journal of Economics and Agriculture Development, 26(4), 244-251.
15- Mohamadghasemi, M., Kouhkan, S.H.A., Akbari Moghadam, H., Rostami, H., Goli Mahmoudi, H. (2008). Cost- benefit analysis of agricultural products in Sistan and Baluchestan. Journal of Rural Dvelopment, 11(4), 71-88.
16- Sabouhi, M., Rastegaripou, F., & Kahkha, A. (2008). Optimal allocation of water through the dam between urban and agricultural uses two-stage stochastic programming using fuzzy interval parameter in uncertainty. Agricultural Economics, 3(1),33-55.
17- Salimifard, K.H., & Mostafaee Dowlatabad, K.H. (2013). Applying Stochastic Goal Programming to Water Resource Management. Journal of Water and Soil, 27(2), 282-291.
18- Sharaki, J., & Mohamadghasemi, M. (2014). Economic allocation of water resources in the region of Sistan using dynamic optimization. Paper presented at the Intrnational Conference on sustainable development, stratege and challengs, Tabriz-Iran .
19- Thompson, D., & Powell, R. (1998). Exceptional circumstances provisions in Australia—is there too much emphasis on drought? Agricultural Systems, 57(3), 469-488.
20- Tu, M. Y., Hsu, N. S., & Yeh, W. W. G. (2003). Optimization of reservoir management and operation with hedging rules. Journal of Water Resources Planning and Management, 129(2), 86-97.

21- Zeng, X., Hu, T., Guo, X., & Li, X. (2014). Water transfer triggering mechanism for multi-reservoir operation in inter-basin water transfer-supply project. Water Resources Management, 28(5), 1293-1308.