Assessing the direct economic effects of reallocating irrigation water to alternative uses : concepts and an application

Irrigation water reallocations are playing an increasingly important role in both developed and developing countries. With growing urban and environmental water demands, rising costs for the development of new water supplies, and irrigated agriculture usually including the least economically valuable use of water, transfers of irrigation water to alternative uses are increasing. However, such reallocations are often controversial, and it is often questioned whether the benefits resulting from these transactions are large enough to outweigh the associated costs. This paper reviews the experience with irrigation water transfers, including the involvement of the World Bank. It discusses the problems of assessing the direct economic effects of reallocations, with a focus on the foregone direct benefits in irrigated agriculture. Because foregone direct benefits cannot easily be directly observed, they need to be estimated. However, assessments have shown widely differing estimates -- even when the same methodology was used. The paper reviews the methodologies and model specifications used for estimating foregone direct benefits; illustrates the impact of different model specifications on the magnitude of estimates of foregone direct benefits based on an application in an example case; and draws conclusions with regard to future efforts in assessing reallocation effects, including calculating adequate compensation for farmers. Because estimating the direct benefits of irrigation expansion is methodologically equivalent to estimating foregone direct benefits from reduced irrigation water supplies, the findings have implications for a broader range of water allocation decisions.Water Conservation,Water Economics,Water Policy&Governance,Irrigation and Drainage,Natural Resources Management

Assessing the Direct Economic Effects of Reallocating Irrigation Water to Alternative Uses: Concepts and an Application

Irrigation water reallocations are playing an increasingly important role in both developed and developing countries. With growing urban and environmental water demands, rising costs for the development of new water supplies, and irrigated agriculture usually including the least economically valuable use of water, transfers of irrigation water to alternative uses are increasing. However, such reallocations are often controversial, and it is often questioned whether the benefits resulting from these transactions are large enough to outweigh the associated costs. This paper reviews the experience with irrigation water transfers, including the involvement of the World Bank. It discusses the problems of assessing the direct economic effects of reallocations, with a focus on the foregone direct benefits in irrigated agriculture. Because foregone direct benefits cannot easily be directly observed, they need to be estimated. However, assessments have shown widely differing estimates -- even when the same methodology was used. The paper reviews the methodologies and model specifications used for estimating foregone direct benefits; illustrates the impact of different model specifications on the magnitude of estimates of foregone direct benefits based on an application in an example case; and draws conclusions with regard to future efforts in assessing reallocation effects, including calculating adequate compensation for farmers. Because estimating the direct benefits of irrigation expansion is methodologically equivalent to estimating foregone direct benefits from reduced irrigation water supplies, the findings have implications for a broader range of water allocation decisions

Measuring Foregone Direct Benefits of Irrigation Water Transfers: The Effect of Model Specification

Crop Production/Industries, Resource /Energy Economics and Policy,

Determining the Price-Responsiveness of Demands for Irrigation Water Deliveries versus Consumptive Use

A water-crop simulation/mathematical programming model of irrigation water demand in northeastern Colorado is formulated to develop an original concept of derived demand for consumptive use of water. Conventional demand functions for water deliveries are also developed, and the effect of hypothetical price increases on both consumption and delivery are illustrated. Findings indicate that demand elasticity estimates are quite sensitive to model specification, and consumptive use demand tends to be significantly less price-responsive than delivery demand. Thus price incentives are likely to have only limited impacts on basin-wide water consumption and would not make much additional water available for emerging demands.crop simulation, irrigation, mathematical programming, water conservation, water-demand elasticities, water policy, Demand and Price Analysis, Resource /Energy Economics and Policy,

IRRIGATION WATER DEMAND: A META ANALYSIS OF PRICE ELASTICITIES

Meta-regression models are estimated to investigate sources of variation in empirical estimates of the price elasticity of irrigation water demand. Elasticity estimates are drawn from mathematical programming, econometric and field experiment studies reported in the United States since 1963. Explanatory variables include method of analysis, water price, time-frame of analysis, farmers' adjustment options, type of data, and climate. Results indicate that the magnitudes of elasticity estimates are affected by the method of analysis. When separate regressions are performed for the estimates from each method, the price of water at which an elasticity is estimated as well as the time-frame of analysis are found to influence price elasticities.Resource /Energy Economics and Policy,

Overcoming agricultural pollution of water: The challenge of integrating agricultural and environmental policies in the european union

ix+67hlm.;27c

Overcoming agricultural pollution of water : the challenge of integrating agricultural and environtal policies in the european union

Bibl. hlm. 67ix, 77 hlm. : il. ; 28 cm