Publications

Why irrigation water pricing is not widely used

Davidson, Brian; Hellegers, Petra; Namara, Regassa Ensermu

Summary

Despite its obvious advantages, pricing irrigation water is not widely practiced because it is not easy to deploy effectively. Water authorities require an understanding of the objectives they hope to gain from it, the performance different pricing instruments have and the preconditions that must be met to enable them to work. Also, pricing instruments work under assumptions that do not hold in an environment where multiple market failures exist and their introduction may lead to a number of unintended consequences those who operate irrigation systems never considered. The aim in this paper is to outline the difficulties that are associated with implementing pricing instruments in the irrigation sector.