In this paper we examine the adoption of rainwater harvesting (RWH),
a technology that has relatively recently been introduced to farmers in
Nepal. Using data from 282 farmers in four districts, the study employs
a treatment-effects model to identify factors that influence the adoption
of RWH and the impact of adoption on farm income. We find that the
adoption of rain water harvesting is mostly driven by farmer training.
Further, adoption of this technology more than doubles household
agricultural and livestock income. With incremental annual benefits
of NRs. 69,456 (USD 700), this technology is viable from a household
perspective. Adopters benefit from an increased supply of irrigation
water, which allows them to diversify their crops from cereal production
to high-value vegetable crops. Our analyses suggests that if 10 percent
of households (7000 households) in an average rainfed district receive
farmer training, the net benefits from training in the district would be
approximately NRs. 134,907,710 (USD 1.3 million) per year from adoption
of RWH technology. Given the many weather-related uncertainties faced
by rainfed farmers in Nepal, rain water harvesting is potentially a very
useful climate adaptation strategy.