The fight against poverty in the Peruvian Andes is a complex task in which various professionals, such as engineers, economists, anthropologists, among others, participate. The uncertainty of the decisions taken today, no matter how appropriate they may seem, such as million-dollar investments in irrigation infrastructure, can result in overproduction and, therefore, in economic recessions. For this reason, a new mathematical simulation model is proposed using system dynamics to predict recession phenomena that can occur in months or after a few years of auspicious economic growth, and that can cause sales prices to be below production costs. The author has developed the conceptualization of the production system of irrigation improvement projects in several years of multidisciplinary work in the Cusco region of Peru. The primary objective of irrigation projects is to improve the socio-economic conditions of the farmer. Techniques as the fulfillment of goals have been used to quantify qualitative dimensions such as strengthening organizations and trainings that are key to guaranteeing irrigation improvement projects' sustainability in the long term. Therefore, it has been possible to identify the variables and relationships of this type of socio-economic system. To validate the model, we verified that the simulated data are consistent with the historical data collected. Likewise, if the values of the various proposed models' variables are adequately modified, these can be applied to other types of production systems under different market conditions. The dimensions addressed, such as supply, demand, sale price, land, production volume, public budget, etc., enhance the research's importance, making the simulation model formally expressed also acquire nuances from economic theory for the fight against poverty-based on water. One of the study's conclusions is to understand the production systems, it is necessary to see them in the context of their regional economy's behavior.