Planning irrigation improvements in Egypt : the impact of policies and prices on farm income and resource use

The linear programming model of a farm management decision problem, based on an average sized farm found in a survey of 50 farms in Kafr El Sheikh, was used to allow observation of the interdependencies. Changes in the method of irrigation or in the government"s system of water supply were evaluated. Four sets of policy alternatives are examined. The base run reflects existing policies, a second option includes only administered prices. Additionally, a free market alternative is tested and, finally, a free market coupled with a system to charge farmers for the delivery of water is assessed. Results show that existing policies do not greatly distort the optimal mix of enterprises, but it is likely that farmers would have incentive to achieve higher crop yields under different price policies. As yield associated with higher commodity prices are achieved, farmers" incentives and ability to adopt improved water management practices would be enhanced. (Author abstract, modified)