Peer effects in irrigation adoption in South Carolina

Abstract Irrigation can enhance yields and serve as a climate adaptation strategy. In the Southeastern U.S., where water resources are relatively abundant, irrigation has experienced significant growth. However, despite the region’s capacity for further expansion, irrigation adoption rates remain low. This study estimates the influence of peer effects on farmers’ decisions to adopt irrigation in South Carolina, using a unique parcel-level dataset on irrigation withdrawals. We find that adoption increases as farmers observe more peer adopting irrigation – social interactions – and as peers’ pumping increases, such as during drought periods, when the benefits of irrigation become more visible, facilitating social learning.