Analyzing agricultural demand for water with an optimizing model

The paper introduces an optimizing linear model for analysing agricultural production under various water quantities, qualities, timing, prices and pricing policies. The model is designed to serve as a decision-making tool for planners of agricultural production on district and national levels. The output solutions provide the optimal mix of water-consuming activities to maximize the net income of the agricultural production of the districts and the water demands under various prices. It also provides the user with procedures to carry out ‘if–then’ sensitivity and scenario analyses and to generate optimal water demand curves. The paper presents the formulation of the model, indicating and analysing problems of linearity and scaling, the steps undertaken to examine and verify it, optimal water demand curves for eight districts in Israel (separately and as an integrated unit) and calculated estimates of water demand elasticity.