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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

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.

Suggested Citation

  • Blanco-Gutiérrez, Irene & Varela-Ortega, Consuelo & Flichman, Guillermo, 2011. "Cost-effectiveness of groundwater conservation measures: A multi-level analysis with policy implications," Agricultural Water Management, Elsevier, vol. 98(4), pages 639-652, February.
  • Handle: RePEc:eee:agiwat:v:98:y:2011:i:4:p:639-652
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    Cited by:

    1. Buchholz, Matthias & Holst, Gesa & Musshoff, Oliver, 2015. "Water and irrigation policy impact assessment using business simulation games: Evidence from northern Germany," DARE Discussion Papers 1505, Georg-August University of Göttingen, Department of Agricultural Economics and Rural Development (DARE).
    2. repec:eee:agisys:v:154:y:2017:i:c:p:168-178 is not listed on IDEAS
    3. Komarek, Adam M. & Drogue, Sophie & Chenoune, Roza & Hawkins, James & Msangi, Siwa & Belhouchette, Hatem & Flichman, Guillermo, 2017. "Agricultural household effects of fertilizer price changes for smallholder farmers in central Malawi," Agricultural Systems, Elsevier, vol. 154(C), pages 168-178.
    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.
    5. J. Alarcón & L. Juana, 2016. "The Water Markets as Effective Tools of Managing Water Shortages in an Irrigation District," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(8), pages 2611-2625, June.
    6. repec:eee:agiwat:v:191:y:2017:i:c:p:207-217 is not listed on IDEAS
    7. repec:eee:agisys:v:159:y:2018:i:c:p:111-125 is not listed on IDEAS
    8. Hrozencik, Robert Aaron & Manning, Dale T., 2016. "Groundwater Management Policy Evaluation with a Spatial-Dynamic Hydro-Economic Modelling Framework," 2016 Annual Meeting, July 31-August 2, 2016, Boston, Massachusetts 236116, Agricultural and Applied Economics Association.
    9. 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.
    10. 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: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 25(13), pages 3387-3411, October.
    11. 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.

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