Efficiency in Irrigation [antikvár]

Preface The papers in this volume are from a conference on the effects of externalities on the efficiency of irrigated agriculture in developing countries. The conference, which was held at the World Bank in Washington, D.C., May 11-13, 1983, examined the economic effects of the physical externality that is created when agricultural producers rely on a common aquifer or stream-aquifer system for their water supply. Although this seems at first glance to be a special case, it applies to more than half the irrigated acreage in the developing countries. Such a physical externality is known to lead to inefficiency. The additional costs producers impose on one another in pumping water from the aquifer can destroy the social efficiency of individuals' decisions on resource allocation. But all of the suggested remedies present difficulties in implementation that restrict their application. For example, corrective taxes or subsidies are an attempt to adjust private costs to reflect the full social costs. But in many circumstances it is difficult to monitor the activities of economic agents, who thus have an incentive to cheat in reporting their activities. The remedy of cooperative management of the resource through a centralized operation suffers in many circumstances from a similar monitoring problem that again creates incentives to cheat. The assignment of legal property rights, whereby the span of physical effects is made to coincide with legally recognized responsibility, also suffers from severe implementation problems in most contexts. There is therefore a need to consider other approaches to the problem of efficiency in irrigated agriculture when such externalities are present. Recognition of this need led to the conference on which this book is based. The consensus of the conference participants was that the available remedies for coping with the gap between private and social costs induced by such an externality may perform tolerably well in most situations and that several innovative approaches may improve the allocation of resources in more difficult cases. Thus O'Mara (chapter 1) argues that farmer participation in the planning and management of water resources—through fanner organizations empowered to monitor water use and redress abuses—will eliminate, or at least reduce the scale of, inefficient irrigation practices. In a similar vein Randall (chapter 2) contends that prospects for stable cooperative approaches have been underrated and that better designed incentives may induce irrigation bureaucracies to improve the services they provide their farmer clients. Ra-dosevich (chapter 3) takes the position that the legal rights remedy could be made more effective through reform of the legal institutional structure surrounding water use. These upbeat perspectives, based largely on conceptual grounds discussed in the initial chapters, receive empirical support from the case histories described in chapters 4-6. Coe (chapter 4), for example, reports that in several groundwater basins in California the adverse effects of an externality among the users of a common aquifer led farmers to work out a solution among themselves—in this case, a tax on water withdrawals. Johnson's description (chapter 5) of the experience with public tubewells in Pakistan is less encouraging, but farmer participation was absent in this case and thus the incentives for bureaucratic efficiency were attenuated. Although Huang, Cai, and Nickum (chapter 6) indicate that significant inefficiency still exists in the North China Plain, they also describe a search for greater efficiency that is remarkably flexible considering the difficult institutional arrangements for water use in China. As O'Mara notes (chapter 1), California has already chosen an institutional solution to the inefficiency induced by the externality among groundwater users, but Pakistan and China have yet to find a stable solution to the problem. Participants in the conference reviewed various analytical methods for evaluating policy alternatives and providing guidelines for eliminating inefficiency in water allocation. Gorelick (chapter 7), for example, reviews a set of models which simulate the behavior of economic agents under conditions including complex groundwater-surface water interactions and specific institutional arrangements.