Property rights and sustainable irrigation—A developed world perspective

Michael Hanemann ()

Agricultural Water Management, 2014, vol. 145, issue C, 5-22

Abstract: This paper draws on the history of irrigation in the US West to address two sets of questions: First, did problems of collective action arise during the development of irrigation in that region? If so, were they successfully resolved? If so, how—did the solution align with Ostrom, 1993. Water Resour. Res. 29 (7), 1907–1912 design principles? Second, how sustainable was the system of water management institutions and water property rights that emerged in the US West? Has it been conducive to the efficient use of water in the West, regarded as a necessary (although not sufficient) condition for sustainability? If not, why not? It is crucial to distinguish the collective action task of building an irrigation system from that of running a system once constructed. With regard to irrigation system construction and financing, the key was not trust, as some have suggested, but capital: irrigation systems are extremely capital intensive, the capital is very long-lived, it is not modular – it cannot usefully be installed bit by bit – it is marked by major economies of scale, and it is not fungible elsewhere or in other uses. This creates massive problems of contracting, default, and bankruptcy, which in fact were a hallmark of irrigation development in the West. The failure to solve collective action in system construction contrasted with the eventual success at collectively operating an irrigation system once constructed, which was accomplished through two idiosyncratic American mechanisms—mutual water companies and special government districts. The development of irrigation in the US West left a legacy of problems with the definition and administration of property rights to water, yielding a dual system with water relatively fungible within irrigation organizations but, typically, not between them. The diversity and complexity of property rights to water was a predictable consequence of the economics and politics of water development.

JEL-codes: D23 D62 D70 Q25 Q38 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:agiwat:v:145:y:2014:i:c:p:5-22

DOI: 10.1016/j.agwat.2014.07.001

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