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A Market-Based Economic Instrument to Better Use Water in Agriculture

Author

Listed:
  • Oana Brînzan

    (Faculty of Food Engineering, Tourism and Environmental Protection, Aurel Vlaicu University of Arad, Str. Elena Drăgoi, no 2, 310330 Arad, Romania)

  • Marian Drăgoi

    (Faculty of Forestry, Stefan cel Mare University of Suceava, Str. Universitatii, 13, 720225 Suceava, Romania)

  • Dalia Bociort

    (S.C. Water Company Arad S.A., Str. Sabin Drăgoi, Nr. 2-4, 312330 Arad, Romania)

  • Eugenia Țigan

    (Faculty of Food Engineering, Tourism and Environmental Protection, Aurel Vlaicu University of Arad, Str. Elena Drăgoi, no 2, 310330 Arad, Romania)

  • Nicoleta Mateoc-Sîrb

    (Department of Management and Rural Development, Banat’s University of Agricultural Sciences and Veterinary Medicine, Calea Aradului 119, Timis, 300645 Timisoara, Romania)

  • Monica Lungu

    (Faculty of Food Engineering, Tourism and Environmental Protection, Aurel Vlaicu University of Arad, Str. Elena Drăgoi, no 2, 310330 Arad, Romania)

Abstract

The paper presents a market-oriented system of returnable guarantees that can be combined with tradable permits to encourage farmers to use alternative sources of water instead of the regular watering network, or to steer the farming system toward environmentally-friendly systems like low tillage and/or organic farming. Factual data from real farming were bootstrapped to test whether or not a set of farms could save water and reduce chemical input due to the higher cost of maintaining the status quo. Based on interactions between water, pesticides, fertilizers, and crops, the system of returnable guarantee determines the farmers to reduce the amount of water harvested from aquifers, generates benefits for the most environmentally-friendly farmers, and stimulate conversion to organic farming.

Suggested Citation

  • Oana Brînzan & Marian Drăgoi & Dalia Bociort & Eugenia Țigan & Nicoleta Mateoc-Sîrb & Monica Lungu, 2020. "A Market-Based Economic Instrument to Better Use Water in Agriculture," Sustainability, MDPI, vol. 12(4), pages 1-12, February.
    • Handle: RePEc:gam:jsusta:v:12:y:2020:i:4:p:1473-:d:321376
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    References listed on IDEAS

    as
    1. Aurora García-Gallego & Nikolaos Georgantzís & Roberto Hernán-González & Praveen Kujal, 2012. "How do Markets Manage Water Resources? An Experiment," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 53(1), pages 1-23, September.
    2. Brooks, Robert & Harris, Edwyna, 2008. "Efficiency gains from water markets: Empirical analysis of Watermove in Australia," Agricultural Water Management, Elsevier, vol. 95(4), pages 391-399, April.
    3. Wigier, Marek (ed.) & Kowalski, Andrzej (ed.), 2018. "The CAP and national priorities within the EU budget after 2020," Multiannual Program Reports 302754, Institute of Agricultural and Food Economics - National Research Institute (IAFE-NRI).
    4. S. I. Efe, 2006. "Quality of rainwater harvesting for rural communities of Delta State, Nigeria," Environment Systems and Decisions, Springer, vol. 26(3), pages 175-181, September.
    5. Andersson, Fredrik, 1997. "Small Pollution Markets: Tradable Permits versus Revelation Mechanisms," Journal of Environmental Economics and Management, Elsevier, vol. 32(1), pages 38-50, January.
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    Cited by:

    1. Efthymios Rodias & Eirini Aivazidou & Charisios Achillas & Dimitrios Aidonis & Dionysis Bochtis, 2020. "Water-Energy-Nutrients Synergies in the Agrifood Sector: A Circular Economy Framework," Energies, MDPI, vol. 14(1), pages 1-17, December.

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