Economic Organization and the Structure of Water Transactions

Kyle Emerick () and Dean Lueck

Journal of Agricultural and Resource Economics, 2015, vol. 40, issue 3, 18

Abstract: This paper analyzes the structure of water transactions using data on contract duration from California. Water rights in the western United States are transferred through short-term and longterm leases as well as permanent ownership contracts. We test predictions about the type of water contracts derived from the literature on economic organization by using ordered probit models to investigate the correlates of contract duration.We confirm that long-term and permanent contracts are more likely when investments in specific assets are required for conveyance. We also find that longer-term arrangements are common when buyers with uncertain water supplies purchase from sellers with more certain rights, suggesting that urban municipalities use long-term contracts to reduce risk. We do not find robust evidence supporting the hypothesis that short-term agreements are more likely when the costs of transfer to third parties are potentially high.

Keywords: Agricultural and Food Policy; Environmental Economics and Policy (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://ageconsearch.umn.edu/record/210544/files/J ... merick_pp347-364.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:jlaare:210544

DOI: 10.22004/ag.econ.210544

Access Statistics for this article

More articles in Journal of Agricultural and Resource Economics from Western Agricultural Economics Association Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().