"From Flow to Fortune? The Economic Impacts of Agricultural Dams"

We examine the economic effects of agricultural dams for Iran. To estimate the benefits of having a larger dam, we introduce a novel triple-differences identification strategy using information on rainfed and irrigated land. The benefits for landowners and agricultural workers are captured by a range of measures ({e.g.}, land rent, profit, agricultural output, wages). We demonstrate that increasing water volume of upstream dams creates substantial benefits for landowners, but not for agricultural workers. Only about half of agricultural dams pass a cost-benefit test. Due to diminishing returns, benefit-to-cost ratios decrease with dam size.