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European Association of Agricultural Economists >
2008 International Congress, August 26-29, 2008, Ghent, Belgium >
Please use this identifier to cite or link to this item:
http://purl.umn.edu/43836
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| Title: | A new methodology for assessing the impact of water-pricing scenarios: case study of small-scale irrigation schemes in South Africa |
| Authors: | Speelman, Stijn
Frija, Aymen
Farolfi, Stefano
Buysse, Jeroen
D'Haese, Marijke F.C.
D'Haese, Luc |
| Keywords: | water-pricing
water savings
irrigation
data envelopment analysis
South Africa |
| Issue Date: | 2008 |
| Abstract: | Worldwide growing water scarcity has
increased the call for economic instruments to stimulate
rational water use in agriculture. In addition cost-recovery
is now widely accepted as a cornerstone of
sustainable water management. As a consequence now
in developing countries, where currently agricultural
water use is often still heavily subsidized, a tendency
exists of introducing water-pricing as a policy to achieve
more sustainable water use. The exact impact of water
pricing policies on irrigation water use or on the
farmers’ production system is however mostly unknown.
A new two-stage methodology that allows estimating at
the farm level the effects of introducing or raising a
water price on the agricultural production process and
water demand is introduced in this study. The first stage
comprises the construction of a technical efficiency
frontier and the calculation of the technical and
allocative efficiency levels of each farm. This
representation of the technology is used in the second
stage in a profit maximization model. As an example the
method is applied to the case of small-scale irrigators in
South Africa. It is shown that water demand of farmers
is quite responsive even to small changes in the water
price. Moreover, the introduction of a water price is
shown to significantly decrease farm profit. This
appears to be mainly a problem for the poorer farmers. |
| URI: | http://purl.umn.edu/43836 |
| Institution/Association: | European Association of Agricultural Economists>2008 International Congress, August 26-29, 2008, Ghent, Belgium |
| Total Pages: | 9 |
| Collections: | 2008 International Congress, August 26-29, 2008, Ghent, Belgium
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