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Water Markets in Mexico: Opportunities and Constraints

  • Hearne, Robert R.
  • Trava, Jose L.

In 1992, the Government of Mexico initiated a new national water law which decentralised water resources management and allowed the market transfer of water-use concessions between individual irrigators. These reforms were expected to improve water resources management through greater user participation in irrigation management, as well as to increase irrigatorsÂ’ incentives to improve water-use efficiency. At the time of its proposal the 1992 Federal Water Law was considered to the first step in the establishment of limited water markets. This paper addresses the opportunities and constraints to improved water resource use and allocation through the market incentives that result from transferable water-use permits. The paper reviews water allocation institutions in Mexico and provides case studies of water allocation and decision-making.

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Paper provided by International Institute for Environment and Development, Environmental Economics Programme in its series Discussion Papers with number 24145.

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Date of creation: 1997
Date of revision:
Handle: RePEc:ags:iieddp:24145
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  1. Hearne, Robert R. & William Easter, K., 1997. "The economic and financial gains from water markets in Chile," Agricultural Economics, Blackwell, vol. 15(3), pages 187-199, January.
  2. Dinar, Ariel & Letey, J., 1991. "Agricultural water marketing, allocative efficiency, and drainage reduction," Journal of Environmental Economics and Management, Elsevier, vol. 20(3), pages 210-223, May.
  3. Easter, K. William & Hearne, Robert R., 1994. "Water Markets And Decentralized Water Resources Management," Staff Papers 13864, University of Minnesota, Department of Applied Economics.
  4. Hearne, R.R. & Easter, K.W., 1995. "Water Allocation and Water Markets. An Analysis of Gains-from-Trade in Chile," Papers 315, World Bank - Technical Papers.
  5. Michael D. Rosen & Richard J. Sexton, 1993. "Irrigation Districts and Water Markets: An Application of Cooperative Decision-Making Theory," Land Economics, University of Wisconsin Press, vol. 69(1), pages 39-53.
  6. Meinzen-Dick, Ruth Suseela & Sullins, Martha, 1994. "Water markets in Pakistan: participation and productivity," EPTD discussion papers 4, International Food Policy Research Institute (IFPRI).
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