IDEAS home Printed from https://ideas.repec.org/a/spr/waterr/v36y2022i10d10.1007_s11269-022-03228-8.html
   My bibliography  Save this article

Priority Water Rights for Irrigation at the River Basin Level. Do They Improve Economic Efficiency During Drought Periods?

Author

Listed:
  • Carlos Gutiérrez-Martín

    (Universidad de Córdoba)

  • José A. Gómez-Limón

    (Universidad de Córdoba)

  • Nazaret M. Montilla-López

    (Universidad de Córdoba)

Abstract

This paper assesses the potential efficiency gains of reforming the water rights regime in the Spanish agricultural sector by replacing current allocation procedures based on the proportional rule with a priority allocation procedure based on two tiers of security-differentiated water rights. This assessment is useful for evaluating whether said change in water rights can be considered a suitable policy instrument to improve water management during droughts events. For this purpose, a mathematical programming model is built to simulate the performance of the proposed reform. The empirical analysis is implemented at the basin scale, where water rights holders are highly heterogeneous, considering different climate scenarios accounting for changes in water supply reliability. The Guadalquivir River Basin (GRB) in southern Spain is used as a case study. The results obtained show that this change in the water allocation regime would yield only modest economic efficiency gains under the current climate scenario. However, it is also evidenced that this policy instrument could play a more relevant role as an efficiency enhancer in a climate change scenario, given that more frequent and intense drought episodes are expected. Moreover, priority rights represent an interesting risk management instrument for farmers, allowing the most vulnerable farmers to reduce income volatility. These findings suggest that the combined implementation of the proposed shift in the allocation regime with spot or allocation water markets would lead to successful outcomes, significantly improving drought management in the irrigation sector.

Suggested Citation

  • Carlos Gutiérrez-Martín & José A. Gómez-Limón & Nazaret M. Montilla-López, 2022. "Priority Water Rights for Irrigation at the River Basin Level. Do They Improve Economic Efficiency During Drought Periods?," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 36(10), pages 3737-3758, August.
    • Handle: RePEc:spr:waterr:v:36:y:2022:i:10:d:10.1007_s11269-022-03228-8
    DOI: 10.1007/s11269-022-03228-8
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11269-022-03228-8
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s11269-022-03228-8?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Mallawaarachchi, Thilak & Auricht, Christopher & Loch, Adam & Adamson, David & Quiggin, John, 2020. "Water allocation in Australia’s Murray–Darling Basin: Managing change under heightened uncertainty," Economic Analysis and Policy, Elsevier, vol. 66(C), pages 345-369.
    2. John Freebairn & John Quiggin, 2006. "Water rights for variable supplies ," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 50(3), pages 295-312, September.
    3. Jacob Rightnar & Ariel Dinar, 2020. "The Welfare Implications of Bankruptcy Allocation of the Colorado River Water: The Case of the Salton Sea Region," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 34(8), pages 2353-2370, June.
    4. Marianne Lefebvre & Lata Gangadharan & Sophie Thoyer, 2012. "Do Security-Differentiated Water Rights Improve the Performance of Water Markets?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 94(5), pages 1113-1135.
    5. Richard E. Howitt, 1995. "Positive Mathematical Programming," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 77(2), pages 329-342.
    6. Heckelei, Thomas & Britz, Wolfgang, 2005. "Models Based on Positive Mathematical Programming: State of the Art and Further Extensions," 89th Seminar, February 2-5, 2005, Parma, Italy 234607, European Association of Agricultural Economists.
    7. Dagmawi Mulugeta Degefu & Weijun He, 2016. "Allocating Water under Bankruptcy Scenario," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(11), pages 3949-3964, September.
    8. Javier Alarcón & Alberto Garrido & Luis Juana, 2014. "Managing Irrigation Water Shortage: a Comparison Between Five Allocation Rules Based on Crop Benefit Functions," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 28(8), pages 2315-2329, June.
    9. M. D. Young & J. C. McColl, 2003. "Robust Reform: The Case for a New Water Entitlement System for Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 36(2), pages 225-234, June.
    10. Giovanni Sechi & Riccardo Zucca, 2015. "Water Resource Allocation in Critical Scarcity Conditions: A Bankruptcy Game Approach," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 29(2), pages 541-555, January.
    11. McCann, Laura, 2013. "Transaction costs and environmental policy design," Ecological Economics, Elsevier, vol. 88(C), pages 253-262.
    12. Marianne Lefebvre & Lata Gangadharan & Sophie Thoyer, 2012. "Do Security-Differentiated Water Rights Improve the Performance of Water Markets?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 94(5), pages 1113-1135.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gómez-Limón, José A. & Gutiérrez-Martín, Carlos & Montilla-López, Nazaret M., 2021. "Priority water rights. Are they useful for improving water-use efficiency at the irrigation district level?," Agricultural Water Management, Elsevier, vol. 257(C).
    2. Benjamin Ouvrard & Stefan Ambec & Arnaud Reynaud & Stéphane Cezera & Murudaiah Shivamurthy, 2022. "Sharing rules for a common-pool resource in a lab experiment," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 59(3), pages 605-635, October.
    3. Guerrero-Baena, M. Dolores & Villanueva, Anastasio J. & Gómez-Limón, José A. & Glenk, Klaus, 2019. "Willingness to pay for improved irrigation water supply reliability: An approach based on probability density functions," Agricultural Water Management, Elsevier, vol. 217(C), pages 11-22.
    4. Smith, Steven M., 2021. "The relative economic merits of alternative water right systems," Journal of Environmental Economics and Management, Elsevier, vol. 105(C).
    5. Liu, Duan & Yu, Nizhou & Wan, Hong, 2022. "Does water rights trading affect corporate investment? The role of resource allocation and risk mitigation channels," Economic Modelling, Elsevier, vol. 117(C).
    6. CARPENTIER, Alain & GOHIN, Alexandre & SCKOKAI, Paolo & THOMAS, Alban, 2015. "Economic modelling of agricultural production: past advances and new challenges," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement (RAEStud), Institut National de la Recherche Agronomique (INRA), vol. 96(1), March.
    7. Viaggi, Davide & Raggi, Meri & Gomez y Paloma, Sergio, 2011. "Farm-household investment behaviour and the CAP decoupling: Methodological issues in assessing policy impacts," Journal of Policy Modeling, Elsevier, vol. 33(1), pages 127-145, January.
    8. Zhou, Wei, 2015. "Three essays on modeling biofuel feedstock supply," ISU General Staff Papers 201501010800005728, Iowa State University, Department of Economics.
    9. Lally, Breda & van Rensburg, Tom M., 2014. "Reducing nitrogen applications on Irish dairy farms: effectiveness and efficiency of different strategies," International Journal of Agricultural Management, Institute of Agricultural Management, vol. 4(1), October.
    10. Jeong, Dawoon & Sesmero, Juan Pablo & Reeling, Carson, 2023. "Experimental Evidence of Efficiency and Equity of Posted Price Markets for Irrigation Water," 2023 Annual Meeting, July 23-25, Washington D.C. 335840, Agricultural and Applied Economics Association.
    11. Syed Shurid Khan & Shawn Arita & Richard Howitt & PingSun Leung, 2022. "Evaluating change in property tax regime on noncommercial food production using a modified positive mathematical programming model," SN Business & Economics, Springer, vol. 2(9), pages 1-20, September.
    12. Doole, Graeme J. & Marsh, Dan K., 2014. "Use of positive mathematical programming invalidates the application of the NZFARM model: Response to Daigneault et al. (2014)," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 58(2), April.
    13. Philippe Bontems & Celine Nauges, 2019. "Production choices with water markets and risk aversion: the role of initial allocations and forward trading," Post-Print hal-02349932, HAL.
    14. Dietrich Earnhart & Nathan P. Hendricks, 2023. "Adapting to water restrictions: Intensive versus extensive adaptation over time differentiated by water right seniority," American Journal of Agricultural Economics, John Wiley & Sons, vol. 105(5), pages 1458-1490, October.
    15. Fragoso, R. & Marques, C. & Lucas, M.R. & Martins, M.B. & Jorge, R., 2011. "The economic effects of common agricultural policy on Mediterranean montado/dehesa ecosystem," Journal of Policy Modeling, Elsevier, vol. 33(2), pages 311-327, March.
    16. Kamel Elouhichi & Pascal Tillie & Aymeric Ricome & Sergio Gomez-Y-Paloma, 2020. "Modelling Farm-household Livelihoods in Developing Economies: Insights from three country case studies using LSMS-ISA data," JRC Research Reports JRC118822, Joint Research Centre.
    17. Doole, Graeme J. & Marsh, Dan K., 2014. "Methodological limitations in the evaluation of policies to reduce nitrate leaching from New Zealand agriculture," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 58(1), January.
    18. Qureshi, M. Ejaz & Ahmad, Mobin-ud-Din & Whitten, Stuart M. & Kirby, Mac, 2014. "A multi-period positive mathematical programming approach for assessing economic impact of drought in the Murray–Darling Basin, Australia," Economic Modelling, Elsevier, vol. 39(C), pages 293-304.
    19. Faye, Amy & Msangi, Siwa, 2018. "Rainfall variability and groundwater availability for irrigation in Sub-Saharan Africa: evidence from the Niayes region of Senegal," MPRA Paper 92388, University Library of Munich, Germany.
    20. Pérez-Blanco, C.D. & Gutiérrez-Martín, C., 2017. "Buy me a river: Use of multi-attribute non-linear utility functions to address overcompensation in agricultural water buyback," Agricultural Water Management, Elsevier, vol. 190(C), pages 6-20.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:waterr:v:36:y:2022:i:10:d:10.1007_s11269-022-03228-8. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.