Irrigation, water market and climate change: three essays

Irrigation water is vital for agriculture, but climate change presents substantial challenges to its management. This thesis comprises three studies that examine the multidimensional challenges of irrigation water governance, the functionality of water markets, and their potential contribution to mitigating the impacts of climate change. The studies also investigate the effects of climatic conditions on the trading behaviour of water market participants. The first study presents a comprehensive framework for assessing the ability of water governance to cope with climate change. My findings indicate an improvement in the economic efficiency of irrigation water use over the past few decades and the contribution of market-based instruments in managing the impact of climate change. The second study takes a closer look at the functionality and performance of the Murray-Darling Basin (MDB) water market in Australia. The study investigates several key market attributes across a number of trading zones in the sMDB. Overall, the findings document that water markets serve well their fundamental purpose in water resource management, and that various products available in the market enhance market efficiency. The third study uses a portfolio approach to analyse the impacts of climatic conditions, particularly water availability, on the optimal trading strategies of water market participants. The findings illustrate the benefits of portfolio management in improving returns, reducing risks and securing water supply, as opposed to the traditional ownership of a single type of water right. In summary, this thesis addresses the challenges that irrigation water governance confronts in the context of climate change and provides in-depth discussions about potential tools to deal with the challenges. My research highlights the crucial role of economic instruments, particularly water markets, in mitigating these challenges, based on empirical evidence and optimization results

The Economic Impacts of National Nature Reserves on Local Communities in China

The economic impacts of nature reserves have long been controversial. Some studies find that nature reserves impose economic burdens on local residents by limiting agricultural land use and exploitation of natural resources while other studies find that nature reserves could actually alleviate poverty. This thesis empirically examines the county-level economic impacts of national nature reserves (NNRs) in ten provinces in China, using a Difference-in-Differences approach. My results indicate that on average NNRs are associated with a 7% annual increase, 421 2010 yuan correspondingly, in per capita net income for farmers. In addition, the agricultural production value per capita in counties with NNRs is, on average, about 32% higher than that in counties without an NNR. There is also weak evidence for spill-over effects: local GDP per capita is positively correlated with the establishment of NNRs. These economic benefits associated with NNRs are likely to be explained by increased revenue from eco-tourism and forestry production

Quarterly data for examining water market functionality in the sMDB

This dataset provides quarterly statistics generated based on transactional level water trading data for key trading zones in the sMDB. All market transaction data were sourced from NSW and VIC state water registers. Ratios of irrigation water in a trading zone devoted to cotton and fruit & nut trees were calculated based on farm survey data provided by ABS. Quarterly rainfall data is based on monthly rainfall data provided by BoM and further processed by ABARES for catchment level analysis