IDEAS home Printed from https://ideas.repec.org/p/hal/wpaper/hal-01863372.html
   My bibliography  Save this paper

Short and Long term Effects of Water Markets

Author

Listed:
  • Rim Lahmandi-Ayed

    (UR MASE - Modélisation et Analyse Statistique et Economique - ESSAIT - Ecole Supérieure de la Statistique et de l'Analyse de l'Information - UCAR - Université de Carthage (Tunisie))

  • Mohamed Salah Matoussi

    (Université de Tunis)

Abstract

We aim at checking from a theoretical viewpoint the claims made about water markets in the literature. We prove that water markets improve farmers' profits and production efficiency but do not necessarily improve total production and do not always encourage private investments. Taking into account the transaction cost of water markets and the social cost due to the inactivity of some farmers that may result from water markets, we prove that water markets do not always improve total surplus. JEL Classification: Q25, C72, O33.

Suggested Citation

  • Rim Lahmandi-Ayed & Mohamed Salah Matoussi, 2018. "Short and Long term Effects of Water Markets," Working Papers hal-01863372, HAL.
    • Handle: RePEc:hal:wpaper:hal-01863372
    Note: View the original document on HAL open archive server: https://hal.science/hal-01863372
    as

    Download full text from publisher

    File URL: https://hal.science/hal-01863372/document
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Koundouri, Phoebe & Pashardes, Panos & Swanson, Timothy & Xepapadeas, Anastasios, 2003. "The Economics of Water Management in Developing Countries Problems, Principles and Policies," MPRA Paper 38137, University Library of Munich, Germany.
    2. Requate, Till, 1998. "Incentives to innovate under emission taxes and tradeable permits," European Journal of Political Economy, Elsevier, vol. 14(1), pages 139-165, February.
    3. Bill Provencher, 1993. "A Private Property Rights Regime to Replenish a Groundwater Aquifer," Land Economics, University of Wisconsin Press, vol. 69(4), pages 325-340.
    4. Bohm, Peter & Russell, Clifford S., 1985. "Comparative analysis of alternative policy instruments," Handbook of Natural Resource and Energy Economics, in: A. V. Kneese† & J. L. Sweeney (ed.), Handbook of Natural Resource and Energy Economics, edition 1, volume 1, chapter 10, pages 395-460, Elsevier.
    5. Milliman, Scott R. & Prince, Raymond, 1989. "Firm incentives to promote technological change in pollution control," Journal of Environmental Economics and Management, Elsevier, vol. 17(3), pages 247-265, November.
    6. Phoebe Koundouri & Panos Pashardes & Timothy Swanson & Anastasios Xepapadeas, "undated". "The Economics of Water Management in Developing Countries Problems, Principles and Policies," DEOS Working Papers 0303, Athens University of Economics and Business.
    7. 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.
    8. Jung, Chulho & Krutilla, Kerry & Boyd, Roy, 1996. "Incentives for Advanced Pollution Abatement Technology at the Industry Level: An Evaluation of Policy Alternatives," Journal of Environmental Economics and Management, Elsevier, vol. 30(1), pages 95-111, January.
    9. Burness, H Stuart & Quirk, James P, 1979. "Appropriative Water Rights and the Efficient Allocation of Resources," American Economic Review, American Economic Association, vol. 69(1), pages 25-37, March.
    10. Bauer, Carl J., 1997. "Bringing water markets down to earth: The political economy of water rights in Chile, 1976-1995," World Development, Elsevier, vol. 25(5), pages 639-656, May.
    11. Bill Provencher & Oscar Burt, 1994. "A Private Property Rights Regime for the Commons: The Case for Groundwater," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 76(4), pages 875-888.
    12. Burness, H. Stuart & Quirk, James P., 1980. "Economic aspects of appropriative water rights," Journal of Environmental Economics and Management, Elsevier, vol. 7(4), pages 372-388, December.
    13. Phoebe Koundouri & Panos Pashardes & Timothy M. Swanson & Anastasios Xepapadeas (ed.), 2003. "The Economics of Water Management in Developing Countries," Books, Edward Elgar Publishing, number 2846.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Phoebe Koundouri, 2004. "Current Issues in the Economics of Groundwater Resource Management," Journal of Economic Surveys, Wiley Blackwell, vol. 18(5), pages 703-740, December.
    2. Phoebe Koundouri, 2003. "Potential for groundwater management: Gisser-Sanchez effect reconsidered," DEOS Working Papers 0307, Athens University of Economics and Business.
    3. Yoram Bauman & Myunghun Lee & Karl Seeley, 2008. "Does Technological Innovation Really Reduce Marginal Abatement Costs? Some Theory, Algebraic Evidence, and Policy Implications," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 40(4), pages 507-527, August.
    4. Stavins, Robert & Jaffe, Adam & Newell, Richard, 2000. "Technological Change and the Environment," Working Paper Series rwp00-002, Harvard University, John F. Kennedy School of Government.
    5. Arguedas, Carmen & van Soest, Daan P., 2009. "On reducing the windfall profits in environmental subsidy programs," Journal of Environmental Economics and Management, Elsevier, vol. 58(2), pages 192-205, September.
    6. Ben Groom & Phoebe Koundouri & Timothy Swanson, 2005. "Cost-benefit analysis and efficient water allocation in Cyprus," DEOS Working Papers 0502, Athens University of Economics and Business.
    7. Daigee Shaw & Ming-Feng Hung, 2001. "Evolution and evaluation of air pollution control policy in Taiwan," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 4(3), pages 141-166, September.
    8. Koundouri, Phoebe, 2005. "Design and Implementation of an Integrated Water Management Approach," MPRA Paper 38440, University Library of Munich, Germany.
    9. Gill, Tania & Punt, Cecilia, 2010. "The Potential Impact of Increased Irrigation Water Tariffs in South Africa," 2010 AAAE Third Conference/AEASA 48th Conference, September 19-23, 2010, Cape Town, South Africa 96425, African Association of Agricultural Economists (AAAE).
    10. Service Opare, 2011. "Sustaining water supply through a phased community management approach: lessons from Ghana’s “oats” water supply scheme," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 13(6), pages 1021-1042, December.
    11. Newell, Richard G & Stavins, Robert N, 2003. "Cost Heterogeneity and the Potential Savings from Market-Based Policies," Journal of Regulatory Economics, Springer, vol. 23(1), pages 43-59, January.
    12. Groom, Ben & Koundouri, Phoebe, 2011. "The Economics of Water Resource Allocation: Valuation Methods and Policy Implications," MPRA Paper 41902, University Library of Munich, Germany.
    13. Fischer, Carolyn & Parry, Ian W. H. & Pizer, William A., 2003. "Instrument choice for environmental protection when technological innovation is endogenous," Journal of Environmental Economics and Management, Elsevier, vol. 45(3), pages 523-545, May.
    14. Mehdi Fadaee & Luca Lambertini, 2015. "Non-tradeable pollution permits as green R&D incentives," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 17(1), pages 27-42, January.
    15. Adam Jaffe & Richard Newell & Robert Stavins, 2002. "Environmental Policy and Technological Change," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 22(1), pages 41-70, June.
    16. Montero, Juan-Pablo, 2002. "Market Structure and Environmental Innovation," Journal of Applied Economics, Universidad del CEMA, vol. 5(2), pages 1-33, November.
    17. Zhao, Jinhua, 2003. "Irreversible abatement investment under cost uncertainties: tradable emission permits and emissions charges," Journal of Public Economics, Elsevier, vol. 87(12), pages 2765-2789, December.
    18. Montero, Juan-Pablo, 2002. "Permits, Standards, and Technology Innovation," Journal of Environmental Economics and Management, Elsevier, vol. 44(1), pages 23-44, July.
    19. Fischer, Carolyn, 2008. "Emissions pricing, spillovers, and public investment in environmentally friendly technologies," Energy Economics, Elsevier, vol. 30(2), pages 487-502, March.
    20. Lehmann, Paul, 2008. "Using a policy mix for pollution control: A review of economic literature," UFZ Discussion Papers 4/2008, Helmholtz Centre for Environmental Research (UFZ), Division of Social Sciences (ÖKUS).

    More about this item

    Keywords

    Water markets; Water scarcity; Production efficiency; Total production; Private investment; Social costs; Transaction costs;
    All these keywords.

    JEL classification:

    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:hal:wpaper:hal-01863372. See general information about how to correct material in RePEc.

    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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.