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Irrigation water pricing between governmental policies and farmers’ perception: Implications for green-houses horticultural production in Teboulba (Tunisia)

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  • Chebil, Ali
  • Frija, Aymen
  • Thabet, Chokri

Abstract

A positive mathematical programming model was constructed in this study to assess the effect of three water pricing scenarios on Teboulba’s agricultural production systems. The effects of these scenarios were estimated for three groups of farmers from three irrigated districts. Results show that water demand in group 1 remains inelastic until achieving the price of 0.20 TD. A price above this level decreases water consumption, farmer’s incomes as well as seasonal labor demand. For groups 2 and 3, the water demand curves remain highly inelastic even with a full cost recovery price. However, once reaching this last price, the model shows important income reductions reaching 20% of the current observed income. Moreover, a pricing policy aiming to recover operational and maintenance costs and which will be implemented independently from other economic, social and environmental measures can threaten the sustainability of the production systems in the region.

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Bibliographic Info

Article provided by Greek Association of Agricultural Economists in its journal Agricultural Economics Review.

Volume (Year): 11 (2010)
Issue (Month): 2 (June)
Pages:

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Handle: RePEc:ags:aergaa:118863

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Web page: http://www.etagro.gr/
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Related research

Keywords: Water pricing; positive mathematical programming; greenhouses; economic impact; Teboulba; Environmental Economics and Policy; Farm Management; Resource /Energy Economics and Policy; Q15; Q18;

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  1. McKinney, D. C. & Cai, X. & Rosegrant, M. W. & Ringler, C. & Scott, C. A., 1999. "Modeling water resources management at the basin level: review and future directions," IWMI Books, Reports H024075, International Water Management Institute.
  2. Gomez-Limon, Jose A. & Riesgo, Laura, 2004. "Irrigation water pricing: differential impacts on irrigated farms," Agricultural Economics, Blackwell, vol. 31(1), pages 47-66, July.
  3. Kamel Louhichi & Guillermo Flichman & Slim Zekri, 1999. "Un modèle bio-économique pour analyser l'impact de la politique de conservation des eaux et du sol," Économie rurale, Programme National Persée, vol. 252(1), pages 55-64.
  4. Gomez-Limon, J. A. & Berbel, J., 2000. "Multicriteria analysis of derived water demand functions: a Spanish case study," Agricultural Systems, Elsevier, vol. 63(1), pages 49-72, January.
  5. Varela-Ortega, Consuelo & M. Sumpsi, Jose & Garrido, Alberto & Blanco, Maria & Iglesias, Eva, 1998. "Water pricing policies, public decision making and farmers' response: implications for water policy," Agricultural Economics, Blackwell, vol. 19(1-2), pages 193-202, September.
  6. Richard E. Howitt, 1995. "A Calibration Method For Agricultural Economic Production Models," Journal of Agricultural Economics, Wiley Blackwell, vol. 46(2), pages 147-159.
  7. Harry Markowitz, 1952. "Portfolio Selection," Journal of Finance, American Finance Association, vol. 7(1), pages 77-91, 03.
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