The Impacts of Water Pricing and Non-Pricing Policies on Sustainable Water Resources Management: A Case of Ghorveh Plain at Kurdistan Province, Iran

Mohammad Ali Asaadi, Seyed Abolghasem Mortazavi, Omid Zamani, Gholam Hassan Najafi, Talal Yusaf and Seyed Salar Hoseini
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Mohammad Ali Asaadi: Department of Agricultural Economics, Tarbiat Modares University, Tehran 14115-336, Iran
Seyed Abolghasem Mortazavi: Department of Agricultural Economics, Tarbiat Modares University, Tehran 14115-336, Iran
Gholam Hassan Najafi: Department of Mechanical & Biosystems Engineering, Tarbiat Modares University, Tehran 14115-336, Iran
Talal Yusaf: Office of the Pro Vice-Chancellor, Federation University, Ballarat, VIC 3350, Australia
Seyed Salar Hoseini: Department of Mechanical & Biosystems Engineering, Tarbiat Modares University, Tehran 14115-336, Iran

Energies, 2019, vol. 12, issue 14, 1-16

Abstract: As with other regions of Iran, due to excessive extraction of groundwater for intense agricultural activity, Ghorveh plain, a water-scarce irrigation district in the west of Iran, has faced a serious water crisis during the last decade. The present study investigates the impacts of two scenario policies, namely, non-price policy (as a supply-oriented policy) and water pricing policies (as a demand-oriented policy) on agricultural sector of Ghorveh Plain, using positive mathematical programming (PMP). The model was calibrated by using farm-level data for the crop years in 2016–2017. Our findings indicate that applying water supply constraint policy will change the land use and cropping pattern to the crops with higher water productivity. The increase of water resource constraints can lead to the increase of water economic return which indicates a rising value of water resources shortage, warning the producers of the agriculture sector to allocate water to the crops with higher economic value under the water resources shortage conditions. In addition, the findings underline that in a situation where the price of irrigation water is low due to the low elasticity of water demand in the agriculture sector, formulating the economic instruments such as rising water prices does not solely suffice to achieve sustainable water resource management. However, mixed scenarios emphasized that the water distribution policies should be aligned with the increases in water cost.

Keywords: positive mathematical programming; agricultural policy; groundwater; pricing (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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