Economy-wide benefits from establishing water user-right markets in a spatially heterogeneous agricultural economy
AbstractThis paper analyzes the economy-wide gains obtainable from the allocation of surface irrigation water to its most productive use, and evaluates a decentralized mechanism for achieving this result in a spatially heterogeneous environment. The focus country for the analysis is Morocco. The analysis is based on a general equilibrium model that, in addition to the rest of the economy, captures 82 agricultural production activities, 66 of which are in seven separately identified water districts that span the entire country. The results suggest that a decentralized water trading mechanism could increase agricultural output by 8.3 percent, affect the rental rates of other agricultural inputs at the national level, including labor, and have economy-wide effects that entail modest declines in the cost of living, an increase in aggregate consumption, and expansion of international trade.
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Bibliographic InfoPaper provided by International Food Policy Research Institute (IFPRI) in its series TMD discussion papers with number 103.
Date of creation: 2002
Date of revision:
Other versions of this item:
- Diao, Xinshen & Roe, Terry L. & Doukkali, Rachid, 2002. "Economy-Wide Benefits From Establishing Water User-Right Markets In A Spatially Heterogeneous Agricultural Economy," Bulletins 12971, University of Minnesota, Economic Development Center.
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- Thobani, Mateen, 1997. "Formal Water Markets: Why, When, and How to Introduce Tradable Water Rights," World Bank Research Observer, World Bank Group, vol. 12(2), pages 161-79, August.
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