Exit Timing Decisions under Land Speculation and Resource Scarcity in Agriculture

This paper explores the concept of agricultural resilience in the context of climate change related water scarcity. Specifically, the impact of water scarcity on agricultural production is analyzed to derive the timing of exit decisions for farmers faced with the prospect of declining profitability in agriculture but increasing benefits from land rezoning in future. The prospects of land rezoning are modeled as a poison process which may or may not be influenced by farmer’s water abstraction decisions. Selling out of agriculture before land rezoning has an impatience cost as the farmer does not gain the maximum speculative rewards. The analysis highlights the role of such speculative rewards in making farmers resilient to declining profitability in agriculture and also identifies the circumstances under which the water prices may be an ineffective policy tool for allocating water. An empirical application is performed using the above model for the case of a drought prone region in Western Australia.agricultural resilience, exit timing, water scarcity, climate change, Environmental Economics and Policy, Farm Management, Land Economics/Use, Resource /Energy Economics and Policy,

The welfare costs of urban outdoor water restrictions

Outdoor water restrictions are usually implemented as bans on a particular type of watering technology (sprinklers), which allow households to substitute for labour-intensive (hand-held) watering. This paper presents a household production model approach to analysing the impact of sprinkler restrictions on consumer welfare and their efficacy as a demand management tool. Central to our empirical analysis is an experimentally derived production function which describes the relationship between irrigation and lawn quality. We demonstrate that for a typical consumer complete sprinkler bans may be little more effective than milder restrictions policies, but are substantially more costly to the household.household model, urban water demand, urban water restrictions, Resource /Energy Economics and Policy,

Valuing Urban Wetlands of the Gnangara Mound: A Hedonic Property Price Approach in Western Australia

Up to 60% of potable water supplied to Perth in Western Australia is extracted from the Gnangara mound. Many of the urban wetlands above the Mound are groundwater-dependent. Excessive groundwater extraction and climate change have resulted in a decline in water levels in the wetlands. This study estimates the value of urban wetlands in three local government districts in the Perth metropolitan region using the hedonic property price approach. Preliminary results found that proximity to wetlands influences the sales prices of properties. The marginal implicit price of reducing the distance to the nearest wetland by 1 metre, evaluated at the mean sales value, is AU$463. If there is more than one wetland within 1.5 kilometres of a property, the second wetland will help increase the property price by AU$6,081. For a 50 ha wetland, we estimate the total premium of on sales due to wetland proximity is AU$220 million, based on average property characteristics and medium house density. These results will help inform policy makers and land developers on the value of conserving existing urban wetlands, creating new wetland areas and urbanising rural wetlands.groundwater, housing development, aquifer, marginal implicit price, Land Economics/Use,

Modelling farmer choices for water security measures in the Litani river basin in Lebanon

The final publication is available at Elsevier via https://dx.doi.org/10.1016/j.scitotenv.2018.07.410 © 2019. This manuscript version is made available under the CC-BY-NC-ND 4.0 license https://creativecommons.org/licenses/by-nc-nd/4.0/Lebanon is facing an increasing water supply deficit due to the increasing demand for freshwater, decreasing surface and groundwater resources and malfunctioning water governance structures. Technological and policy changes are needed to alleviate the impact of water scarcity and secure water in the future. This paper investigates farmers' preferences and willingness to pay (WTP) in a choice experiment for a series of water saving measures at plot and irrigation district level, including more timely information of water delivery. These measures are expected to strengthen water security and use water more efficiently. Farmers are willing to pay higher water prices of $0.32/m3 and$0.22/m3 to support the implementation of water saving measures at plot level and the installation of water metering devices across the irrigation district, respectively. They are not willing to pay extra for obtaining information related to their water delivery earlier in time if this means that they will also have to pay earlier in the year for the water. Farmers with higher income and education levels who decide on their cropping pattern based on expected rainfall data are more interested in taking action than farmers whose cropping decisions are primarily based on last year's sales prices. The study shows that when aiming to design more effective sustainable water management strategies, accounting for farmers' needs and preferences, their age also has to be considered: younger farmers (40 years).FP7-FOOD-CT-2009-245159 project SIRRIMED funded by DG Research of the European Commissionproject AGRISERVI funded by the Spanish Ministry of Science, Innovation and Universities under the European Regional Development Fund (ERDF) [AGL2015-64411-R (MINECO/FEDER)

Exit Timing Decisions under Land Speculation and Resource Scarcity in Agriculture

This paper explores the concept of agricultural resilience in the context of climate change related water scarcity. Specifically, the impact of water scarcity on agricultural production is analyzed to derive the timing of exit decisions for farmers faced with the prospect of declining profitability in agriculture but increasing benefits from land rezoning in future. The prospects of land rezoning are modeled as a poison process which may or may not be influenced by farmer’s water abstraction decisions. Selling out of agriculture before land rezoning has an impatience cost as the farmer does not gain the maximum speculative rewards. The analysis highlights the role of such speculative rewards in making farmers resilient to declining profitability in agriculture and also identifies the circumstances under which the water prices may be an ineffective policy tool for allocating water. An empirical application is performed using the above model for the case of a drought prone region in Western Australia

Estimating the economic benefit of SCUBA diving in the Similan Islands, Thailand

This article reports the results of the travel cost model using the standard and the truncated count data models to estimate the economic value of the Similan Islands, Thailand, from SCUBA diving. The estimated consumer surplus per visit to the Similan Islands using the truncated negative binomial model was US$3,233 and the economic value of the Similan Islands from SCUBA diving was estimated to be up to US$54.96 m. This study shows that, even without non-use values, coral reefs of the Similan Islands, if properly managed and maintained, will continue to have significant value to both Thai and overseas SCUBA divers, as one of the natural treasures of the world