Description

Abstract: This study evaluates the impacts of irrigation development on farming communities in Palawan. This study focus on three major issues: (1) production efficiency in the lowland communities directly affected by irrigation; (2) activity and asset allocation in upland communities indirectly affected by irrigation; and (3) income distribution and poverty incidence patterns within and between these two communities.

To study technical efficiency in the lowlands, a stochastic frontier analysis using an error decomposition technique is used on an unbalanced parcel-level data set from the lowlands. To study activity and resource allocation in the uplands, a seemingly unrelated regressions approach is employed. Results from these regressions are cross-examined using two-way tables and detailed case studies. In studying the distributional impact of irrigation development, selected inequality measures are calculated. The Ginidecomposition technique is used to further examine distributional impacts between population classes within the two groups of communities. To examine the poverty alleviating benefits of irrigation, poverty indices and poverty decomposition techniques are used.

Analyses suggest that, despite the many reported set backs and problems associated with the operation of irrigation facilities in Asia, particularly in the Philippines

(e.g., Levine, 1977; Bromley, 1982), irrigation has benefited many farmers in the study sites both the targeted lowland farmers and the adjacent upland farming communities.

Analysis shows that lowland farmers experienced higher technical efficiency in rice production and improved income distribution with irrigation development.

Results also indicate that, through off-farm employment, irrigation serves as a channel through which lowland agricultural development provided important economic, environmental and distributional benefits in the adjacent uplands. Policies in areas with similar conditions should be cognizant of the strong role of off-farm employment in altering labor allocation by upland households.

Overall, results show strong benefits from irrigation development. One unfavorable impact of irrigation development is that it appears to have led to wider income inequality between lowland and upland communities. The lowlands became relatively better-off and the uplands became relatively worse-off. However, upland households with off-farm work were found to be less worse-off in absolute terms and better off in relative terms than those with no off-farm work.