Determinants of smallholder farmers’ willingness to pay for improved irrigation systems: Evidence from Northwest, Ethiopia

This study attempted to identify determinants of farmers’ maximum willingness to pay (WTP) for improved use of irrigation water. From a population of 1 380, 177 sample households were selected for primary data collection. From the total sample of households, 77.97% of respondents were willing to pay for sustainable irrigation water use via constructing improved irrigation water channels. On the other hand, 22.03% of the respondents were not willing to pay. For data analysis, both descriptive statistics and the tobit model were applied. The result from the tobit regression model reveal that education level, livestock ownership, annual income, irrigation experience, irrigable land size and access to and frequency of extension service were significant variables of farmers’ maximum WTP. Based on the findings, it is possible to conclude that most rural households are willing to pay for and use improved irrigation water. Hence, the study suggests that this could serve as a good indicator that the official body concerned should introduce pricing for irrigation water for farmers and consider these variables when designing an improved irrigation water supply system.