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The introduction of a water rights trading scheme in the Segre Basin and the contribution of reused irrigation water.

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Authors: M. Blanco y M. Viladrich-Grau
Issue: 110-4 (374-399)
Topic: Agricultural Economics
Keywords: Reuse and management of irrigation water, agro-economic model.

Water trading schemes have been widely regarded by the literature as first order economic instruments to ease irrigation water management and promote sustainable use of this resource. This article analyzes the consequences of introducing a water trading scheme in the irrigated area of the Canal de Urgel. To model the creation of this pricing institution it uses the nonlinear mathematical programming model MASIA. This model, unlike other mathematical programming models used in other Spanish irrigated areas, considers the reuse of the irrigation water of the Canal de Urgel. It characterizes the behavior of farmers allowing technical progress and introducing the institutional, environmental and technical restrictions existing in the area. The results show that the establishment of a market mechanism increases the net margin of the Community and that the reuse of irrigation water also reports positive earnings.

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