Effect of Elimination of Energy Subsidies on Agricultural Crops; the Use of Positive Mathematical Programming (PMP) (Case Study; Maharlu Basin-Bakhtegan)

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Abstract:
Gasoil and electricity are the most important energies consumption in the cropping pattern of the sub agronomical. Based on the governmental decision to remove energy carrier's subsidies, this study focuses on the impact of the removal of fuel and electricity subsidies on the cropping pattern of irrigated lands in the Maharlou-Bakhtegan watershed under six scenarios by using Positive Mathematical Progromming and Maximum Entropy methods. The results showed that rising of price of the energy carriers, when other factors are fixed, would decrease the irrigated lands devoted to most of crops including wheat and consequently the gross profit of farmers in entire watershed. While simultaneous rising of crops price as much as increased cost, can be adjusted to increase the area under cultivation and increase gross profit. Because of farmers determined with goal to maximize profit of cropping pattern, in some cases with rising costs, crops with more need to water will replace to crops with less need to water and low profitability and without more withdrawal, gross profit increses. It is recommended to consider the issue of pricing policy in order to protect water resources, crops require less water to be directed to the pattern. It is noteworthy that in all scenarios, the wheat under cultivation land decreased, but still it has the most proportion in the cropping pattern of watershed.
Language:
Persian
Published:
Agricultural Economics, Volume:9 Issue: 3, 2015
Pages:
63 to 84
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