Water Resources Management

, Volume 31, Issue 4, pp 1257–1269 | Cite as

On the Scarcity Value of Irrigation Water: Juxtaposing Two Market Estimating Approaches

Article

Abstract

The aim of this paper is to compare the supply-side and demand-side approaches for assessing the scarcity rents of irrigation water. The results obtained from the case study confirm the expectation that the demand-side rationale provides the lower bound estimate of water scarcity rents. Specifically, a hypothetical elimination of water scarcity brings extra benefits to the local farmers, but these benefits cannot compensate the costs of the backstop technology which provide such extra water. Therefore, the lost opportunities, in terms of income forgone due to water scarcity, cannot legitimize supply-side approaches alone. A “soft” sensitivity analysis was included to examine the robustness of such a cost-effective property, while the policy implications of the results are also examined.

Keywords

Water scarcity rents Demand and supply-side rationales Soft-path approach 

Notes

Acknowledgements

The authors greatly appreciate the financial support of the research project LIFE08 ENV/GR/000570: HydroSense “Innovative Precision Technologies for Optimized Irrigation and Integrated Crop Management in a Water-limited Agro-system”. Also, we kindly appreciate the useful comments and suggestions we received from the Associate Editor and the two anonymous reviewers.

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Copyright information

© Springer Science+Business Media Dordrecht 2017

Authors and Affiliations

  1. 1.Department of Agricultural Economics and Rural DevelopmentAgricultural University of AthensAthensGreece
  2. 2.School of Environmental EngineeringTechnical University of CreteChaniaGreece

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