The Adoption and Diffusion of Level Fields and Basins

Strategic investments in agriculture often are lumpy and irreversible, with significant impacts on operating and fixed costs. Leveling cotton fields to zero slope in central Arizona is a strategic decision made by relatively younger farmers who are farming fine-textured soils in irrigation districts with higher expected water costs. The diffusion of the technology across the region between 1968-89 appears to be both a function of institutional changes (e.g., the Groundwater Management Act of 1980, the Central Arizona Project) and the long-run expected price changes induced by these new policies.