Estimating Farmers’ Willingness to Pay for Improved Irrigation: An Economic Study of the Bontanga Irrigation Scheme in Northern Ghana

Abstract

This paper estimates the willingness of farmers under the Bontanga Irrigation Scheme (BIS) in Northern Ghana to pay for improved irrigation services. The Contingent Valuation Method (CVM) was used in this study and farmers were randomly selected for interviewing based on the location of their farms (upstream, middle, and downstream) within the scheme. The payment card elicitation format was used and the data were analyzed using Maximum Likelihood Estimation (MLE) procedure that is capable of accommodating the intervals in payment card data. The mean willingness to pay was found to be GHC 16.32 (US$ 8.50) per ha per year and the median was GHC 14.00 (US$ 7.29) per ha per year. The study identified location of farm, land ownership, and land lease prices as the significant and influencing factors that affect willingness to pay.