Self-enforcing Agreements on Water allocation

Many water allocation agreements in transboundary river basins are inherently unstable. Due to stochastic river flow, agreements may be broken in case of drought. The objective of this paper is to analyse whether water allocation agreements can be self-enforcing. An agreement is modelled as the outcome of bargaining game on river water allocation. Given this agreement, the bargaining game is followed by a repeated extensive-form game in which countries decide whether or not to comply with the agreement. I assess under what conditions such agreements are self-enforcing, given stochastic river flow. The results show that, for sufficiently low discounting, every efficient agreement can be sustained in subgame perfect equilibrium. Requiring renegotiation-proofness may shrink the set of possible agreements to a unique self-enforcing agreement. The solution induced by this particular agreement implements the “downstream incremental distribution”, an axiomatic solution to water allocation that assigns all gains from cooperation to downstream countries.Self-Enforcing Agreement, Repeated Extensive-Form Game, Water Allocation, Renegotiation-Proofness

Climate Change and the Stability of Water Allocation Agreements

We analyse agreements on river water allocation between riparian countries. Besides being efficient, water allocation agreements need to be stable in order to be effective in increasing the efficiency of water use. In this paper we assess the stability of water allocation agreements using a game theoretic model. We consider the effects of climate change and the choice of a sharing rule on stability. Our results show that a decrease in mean river flow decreases the stability of an agreement, while an increased variance can have a positive or a negative effect on stability. An agreement where the downstream country is allocated a fixed amount of water has the lowest stability compared to other sharing rules. These results hold for both constant and flexible non-water transfer

Water Allocation Mechanisms: Principles and Examples

From the earliest times, water resources have been allocated on the basis of social criteria - maintaining the community by ensuring that water is available for human consumption, for sanitation, and for food production. Societies have invested capital in infrastructure to maintain this allocation. Yet social change, including changes in (and more understanding of) how goods are distributed, has produced new issues in water allocation. Population growth has made water scarcity a major problem in many countries and water pollution, while by no means a recent problem, is more widespread than ever before. Traditionally the state has played a dominant role in managing water resources, but inefficient use of water, poor cost recovery for operating and maintenance expenses, the mounting cost of developing new water sources, and problems with the quality of service in agency-managed systems has led to a search for alternatives that make water allocation and management more efficient. The authors address some of the basic principles of treating water as an economic good and of allocating it among the sectors. After outlining the economic principles behind allocating scarce water resources, they review the actual means of various mechanisms used for allocating water, including marginal cost pricing, social planning, user-based allocation, and water markets. Giving examples from experience in several countries, they weigh the pros and cons of different approaches to water allocation, showing that no single approach is suitable for all situations. Clearly that state must play an important regulatory role, for example, but how effectively it does so depends on the relative political influence of various stakeholders and segments of society. User-based allocation is generally more flexible than state allocation, but collective action is not equally effective everywhere; it is most likely to emerge where there is strong demand for water and a history of cooperation. The outcome of market allocation depends on the economic value of water for various uses, but moving toward tradable property rights in water may ease the process of intersectoral reallocation by compensating the"losers"and creating incentives for efficient water use in all sectors

Wooden proportioning weirs: A physical irrigation structure with social implications

Weirs, Water distribution, Water allocation, Farm management, Irrigation systems, Nepal

Improving water use efficiency under worsening scarcity: Evidence from the Middle Olifants sub-basin in South Africa

With the political changes in South Africa in the early 1990s, the South African government introduced a reform process in the entire water sector with the goal of a more enhanced and equitable water management system. This paper analyzes existing water allocation situations and applies a nonlinear optimization model to investigate the optimal intra- and inter-regional allocations in the Middle Olifants sub-basin of South Africa. Results show higher benefit from inter-regional water allocation. Reducing water supply levels to conform to the sustainable water supply policy, it can be shown that although water supply is reduced by approximately 50%, total benefits from water are only reduced by 5% and 11% for inter- and intra-regional allocation regimes respectively. These results indicate that alternative water allocation mechanisms can serve as instruments to offset for the effects of water scarcity.Water allocation, IWRM, Olifants basin, South Africa, Africa, Resource /Energy Economics and Policy,

Market solutions to water allocation in Texas

San Antonio (Tex.) ; Water-supply - Texas ; Federal Reserve District, 11th

Reforming water allocation policy through markets in tradable water rights: lessons from Chile, Mexico, and California

Increasing water scarcity, rising costs of irrigation subsidies, and general economic liberalization are creating strong incentives for comprehensive water reform with establishment of tradable water rights and the development of markets in these rights. Experiences in Chile, Mexico, and California indicate that water allocation through markets in tradable water rights offers a viable approach to improving the efficiency of water allocation, and should receive serious consideration from developing country policy makers. Laws establishing tradable rights should be simple and comprehensive, should clearly define the characteristics of water rights and the conditions and regulations governing the trade of water rights; should establish and implement water rights registers; delineate the roles of the government, institutions, and individuals involved in water allocation and the ways of solving conflicts between them; and provide cost-effective protection against negative third party and environmental effects which can arise from water trades.Water-supply Management., Irrigation., Right of property., Water rights., Trade regulation.,

Pro-poor intervention strategies in irrigated agriculture: lessons from the Asian experience

Irrigation management / Poverty / Women / Water rights / Water allocation / User charges / Asia / China / Vietnam