Doctor of Philosophy / Department of Agricultural Economics / Nathan P. Hendricks / Risk averse farmers face a substantial challenge managing irrigation water when they face limited water availability. The two primary reasons for limited water availability in the High Plains Aquifer region of the United States are limited well capacity (i.e., the rate at which groundwater can be extracted) or a constraint imposed by a policy. In this dissertation, I study how risk averse farmers optimally manage limited water availability in the face of weather uncertainty and also the impact of limited water availability on farmer welfare. I use AquaCrop, a daily biophysical crop simulation model, to predict corn yield under alternative irrigation scenarios with historical weather. Since no simple functional form exists for the crop production function, I use discrete optimization and consider 234,256 potential irrigation strategies. I also account for risk preferences by using expected utility analysis to determine the optimal irrigation strategy. Using a daily biophysical model is important because water stress in a short period of the growing season can impact crop yield (even if average water availability throughout the growing season is sufficient) and well capacity is a constraint on daily water use. The daily biophysical crop simulation model accounts for the dynamic response of crop production to water availability. First, I examine how optimal irrigation strategies change due to limited water availability. I find that it is never optimal for irrigators to apply less than a particular minimum instantaneous rate per irrigated acre. An optimal required instantaneous rate implies that a farmer with a low well capacity focuses on adjustment at the extensive margin. On the other hand, farmers who initially have a high well capacity should adjust at the intensive margin in response to well capacity declining. I also find that total water use increases as the degree of risk aversion increases. More risk averse farmers increase water use by increasing irrigation intensity to reduce the variance in corn yields. Another important finding is that a higher well capacity could actually promote less water use because the higher well capacity allows a greater instantaneous rate of application that allows the farmer to decrease irrigation intensity while still maintaining or increasing corn yield. This finding may imply an accelerated rate of groundwater extraction when the groundwater depletion reaches a particular threshold. Second, I analyze the welfare loss due to limited water availability. The relationship between welfare loss and well capacity due to a policy constraint differs by soil type. I found the welfare loss from a water constraint policy does not always increase as well capacity increases. Farmers with very high well capacity may make small or no adjustment at the extensive margin due to a higher instantaneous rate and higher soil water holding capacity. However, that is not the case for a farmer with land that has lower soil water holding capacity as the increase in well capacity results in greater welfare loss. I also investigate the effect of risk averse behavior on the magnitude of welfare loss. I found that the welfare loss per unit of reduced water use is lower for the farmer with more risk aversion. Thus, economic models that ignore risk aversion misestimate the cost of reducing water use. Finally, I investigate the incentive for adopting drip irrigation and its effect on water use. I find that a decrease in well capacity increases the benefits of adopting drip irrigation but is not sufficient to overcome the high initial investment cost without government support. While subsidies of the magnitude offered by current U.S. programs are sufficient to induce drip irrigation adoption, I find that such subsidies have the unintended consequence of increasing total water use, particularly for small well capacities.

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Base flow recession curve during a dry period is a distinct hydrologic signature of a watershed. The base flow recession analysis for both streamflow and spring flow has been extensively studied in the literature. Studies have shown that the recession behaviors during the early stage and the late stage are different in many watersheds. However, research on the transition from early stage to late stage is limited and the hydrologic control on the transition is not completely understood. In this dissertation, a novel cumulative regression analysis method is developed to identify the transition flow objectively for individual recession events in the well-studied Panola Mountain Research Watershed in Georgia, USA. The streamflow at the watershed outlet is identified when the streamflow at the perennial stream head approaches zero, i.e., flowing streams contract to perennial streams. The identified transition flows are then compared with observed flows when the flowing stream contracts to the perennial stream head. As evidenced by a correlation coefficient of 0.90, these two characteristics of streamflow are found to be highly correlated, suggesting a fundamental linkage between the transition of base flow recession from early to late stages and the drying up of ephemeral streams. At the early stage, the contraction of ephemeral streams mostly controls the recession behavior. At the late stage, perennial streams dominate the flowing streams and groundwater hydraulics governs the recession behavior. The ephemeral stream densities vary from arid regions to humid regions. Therefore, the characteristics of transition flow across the climate gradients are also tested in 40 watersheds. It is found that climate, which is represented by climate aridity index, is the dominant controlling factor on transition flows from early to late recession stages. Transition flows and long-term average base flows are highly correlated with a correlation coefficient of 0.82. Long-term average base flow and the transition flow of recession are base flow characteristics at two temporal scales, i.e., the long-term scale and the event scale during a recession period. This is a signature of the co-evolution of climate, vegetation, soil, and topography at the watershed scale. The characteristics of early and late recession are applied for quantifying human impacts on streamflow in agricultural watersheds with extensive groundwater pumping for irrigation. A recession model is developed to incorporate the impacts of human activities (such as groundwater pumping) and climate variability (such as evapotranspiration) on base flow recession. Groundwater pumping is estimated based on the change of observed base flow recession in watersheds in the High Plains Aquifer. The estimated groundwater pumping rate is found consistent compared with the observed data of groundwater uses for irrigation. Besides streamflow recession analysis, this dissertation also presents a novel spring recession model for Silver Springs in Florida by incorporating groundwater head, spring pool altitude, and net recharge into the existing Torricelli model. The results show that the effective springshed area has continuously declined since 1988. The net recharge has declined since the 1970s with a significant drop in 2002. Subsequent to 2002, the net recharge increased modestly but not to the levels prior to the 1990s. The decreases in effective springshed area and net recharge caused by changes in hydroclimatic conditions including rainfall and temperature, along with groundwater withdrawals, contribute to the declined spring flow.