IDEAS home Printed from https://ideas.repec.org/p/ags/huaewp/232685.html
   My bibliography  Save this paper

The Israeli Water Economy: Reform vs. Reality

Author

Listed:
  • Hochman, Eithan
  • Brill, Eyal

Abstract

Water has been heavily subsidized in Israel for many years and this policy has resulted in severe wastage of water. Drought, the peace process and the rapid, increase of urban demand has enforced the need for reform in the allocation and pricing of water. Water markets have been suggested in the past, as an efficient mechanism for the allocation of water, despite the lack of empirical evidence to support this claim. National ownership of land and water, as well as the nature of the settlement process in Israel, prevented the creation of Israeli water markets. The privatization of the Israeli water economy has been introduced through quasi-market mechanisms at both the regional and the national level. At the national level, a Hicksian type barter market is practised with given shares of the "initial endowments" while the aggregate water quantity is determined administratively by the central government. At the regional level, a "passive" water trading mechanism is introduced where at a price announced by the policy maker, each individual uses water according to his demand curve and pays a fine or receives monetary compensation according to his share in the aggregate water right. Regulation of a private firm which supplies water at the regional level, is conducted through monitoring the optimal ratio of conjunctive use of surface and underground water. Finally the efficiency of the current tiered pricing policy vs. the reform, is tested, using empirical data from several regions in Israel.

Suggested Citation

  • Hochman, Eithan & Brill, Eyal, 1996. "The Israeli Water Economy: Reform vs. Reality," Working Papers 232685, Hebrew University of Jerusalem, Center for Agricultural Economic Research.
  • Handle: RePEc:ags:huaewp:232685
    DOI: 10.22004/ag.econ.232685
    as

    Download full text from publisher

    File URL: http://ageconsearch.umn.edu/record/232685/files/hebrewuniv-workingpapers-9602.pdf
    Download Restriction: no

    More about this item

    Keywords

    Environmental Economics and Policy;

    Statistics

    Access and download statistics

    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:ags:huaewp:232685. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search). General contact details of provider: http://edirc.repec.org/data/caehuil.html .

    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.

    We have no references for this item. You can help adding them by using 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.