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Cost-effectiveness of groundwater conservation measures: A multi-level analysis with policy implications

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  • Blanco-Gutiérrez, Irene
  • Varela-Ortega, Consuelo
  • Flichman, Guillermo
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    Abstract

    Groundwater in Spain, as in other arid and semiarid countries worldwide, has been widely used in the expansion of irrigated agriculture. In the Spanish Mancha Occidental aquifer, the excessive, and sometimes illegal, water abstraction for irrigation has promoted outstanding socioeconomic development in the area, but it has also resulted in exploitation of the aquifer and degradation of valuable wetlands. Water policies implemented in the region have not yet managed to restore the aquifer and face strong social opposition. This paper uses a multi-scale modeling approach to explore the environmental and socio-economic impacts of alternative water conservation measures at the farm and basin levels. It also analyzes their comparative cost-effectiveness to help policy makers identify the least costly policy option for achieving the goal of the Mancha Occidental aquifer's sustainability. To conduct this analysis, a Mathematical Programming Model has been developed to simulate: the closing-up and taxed-legalization of unlicensed wells, uniform volumetric and block-rate water prices, water quotas, and water markets. Aggregate results show that net social costs are not substantially different across policy option, so none of the considered policy options will be clearly more cost-effective than the others. However, there are significant differences between private and public costs (at the farm and sub-basin levels), which will be critical for determining the application in practice of these policies. Results show that controlling illegal water mining (through the legalization of unlicensed wells) is necessary, but is not sufficient to recover the aquifer. Rather, effective water management in this area will require the implementation of other water management policies as well. Among them, uniform volumetric and block-rate water pricing policies will entail the lowest net social cost, but will produce important income losses in the smallest and most water-intensive farms, which might put at risk the viability of these farms and the social acceptance of the policies. Further investigations on social costs, policy enforcement capacity and public participation in water management are highly recommended.

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    Bibliographic Info

    Article provided by Elsevier in its journal Agricultural Water Management.

    Volume (Year): 98 (2011)
    Issue (Month): 4 (February)
    Pages: 639-652

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    Handle: RePEc:eee:agiwat:v:98:y:2011:i:4:p:639-652

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    Web page: http://www.elsevier.com/locate/agwat

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    Keywords: Groundwater resources Irrigation Wetlands conservation Multi-scale economic modeling Water policies Cost-effectiveness analysis;

    References

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    Cited by:
    1. Kathrin Knüppe & Claudia Pahl-Wostl, 2011. "A Framework for the Analysis of Governance Structures Applying to Groundwater Resources and the Requirements for the Sustainable Management of Associated Ecosystem Services," Water Resources Management, Springer, vol. 25(13), pages 3387-3411, October.
    2. Blanco-Gutierrez, Irene & Varela-Ortega, Consuelo & Purkey, David R., 2011. "Integrated Economic-Hydrologic Analysis Of Policy Responses To Promote Sustainable Water Use Under Changing Climatic Conditions," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114253, European Association of Agricultural Economists.
    3. Esteve, Paloma & Varela-Ortega, Consuelo, 2011. "An Economic Modelling Approach For Vulnerability Assesment In Irrigation Farms In Spain," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114337, European Association of Agricultural Economists.
    4. Li, Y.P. & Huang, G.H. & Nie, S.L. & Chen, X., 2011. "A robust modeling approach for regional water management under multiple uncertainties," Agricultural Water Management, Elsevier, vol. 98(10), pages 1577-1588, August.

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