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Agricultural water rights trading and virtual water export compensation coupling model: A case study of an irrigation district in China

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  • Wang, Y.B.
  • Liu, D.
  • Cao, X.C.
  • Yang, Z.Y.
  • Song, J.F.
  • Chen, D.Y.
  • Sun, S.K.

Abstract

Water rights trading is an effective way to promote efficient water allocation. The implementation of agricultural water rights trading can promote water saving, but may reduce the agricultural production scale in irrigation districts. Compensation for crop virtual water export can increase the benefits of agricultural water use, so as to enhance the competitiveness of economic benefit for agricultural production. This paper analyzed the relationship between agricultural water rights trading and virtual water export compensation, then a bi-level programming model was established with multiple objectives. The model was applied in Hetao irrigation district by using enumeration method. The changes of new water use of different users, benefits of irrigation district and water users with different water prices were analyzed and the optimization schemes were selected. Results show that the model through adjusting price variables including both water rights trading price and virtual water compensation price to optimize the allocation of agricultural water quantity saved among different water users, which at the same time makes both the irrigation management administration and water users get more benefit. The optimized scheme can raise the willingness of water saving in irrigation district, and enhance the competitiveness of agricultural water user against non-agricultural water user. This study provides a new method and scientific basis for the water resource management agency in their policy making.

Suggested Citation

  • Wang, Y.B. & Liu, D. & Cao, X.C. & Yang, Z.Y. & Song, J.F. & Chen, D.Y. & Sun, S.K., 2017. "Agricultural water rights trading and virtual water export compensation coupling model: A case study of an irrigation district in China," Agricultural Water Management, Elsevier, vol. 180(PA), pages 99-106.
    • Handle: RePEc:eee:agiwat:v:180:y:2017:i:pa:p:99-106
    DOI: 10.1016/j.agwat.2016.11.006
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    5. Jing Liu & Xinchun Cao & Binquan Li & Zhongbo Yu, 2018. "Analysis of Blue and Green Water Consumption at the Irrigation District Scale," Sustainability, MDPI, vol. 10(2), pages 1-15, January.
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    7. Pan, Junyu & Peng, Jie & Yang, Xiaodong & Xuan, Siyuan, 2023. "Does water rights trading promote resources utilisation efficiency and green growth? Evidence from China's resources trading policy," Resources Policy, Elsevier, vol. 86(PB).
    8. Fang, Lan & Fu, Yong & Chen, Shaojian & Mao, Hui, 2021. "Can water rights trading pilot policy ensure food security in China? Based on the difference-in-differences method," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 23(6), pages 1415-1434.
    9. Changhai Qin & Shan Jiang & Yong Zhao & Yongnan Zhu & Qingming Wang & Lizhen Wang & Junlin Qu & Ming Wang, 2022. "Research on Water Rights Trading and Pricing Model between Agriculture and Energy Development in Ningxia, China," Sustainability, MDPI, vol. 14(23), pages 1-15, November.
    10. Heidarizadeh, Mohammad & Ahmadian, Mohammad, 2019. "Capacity certificate mechanism: A step forward toward a market based generation capacity incentive," Energy, Elsevier, vol. 172(C), pages 45-56.
    11. Yan, Dong & Chen, Lin & Sun, Huaiwei & Liao, Weihong & Chen, Haorui & Wei, Guanghui & Zhang, Wenxin & Tuo, Ye, 2022. "Allocation of ecological water rights considering ecological networks in arid watersheds: A framework and case study of Tarim River basin," Agricultural Water Management, Elsevier, vol. 267(C).
    12. Yi Liu & Peng Li & Zhiwei Zhang, 2018. "Resilient or Not: A Comparative Case Study of Ten Local Water Markets in China," Sustainability, MDPI, vol. 10(11), pages 1-16, November.
    13. Sun, J.X. & Yin, Y.L. & Sun, S.K. & Wang, Y.B. & Yu, X. & Yan, K., 2021. "Review on research status of virtual water: The perspective of accounting methods, impact assessment and limitations," Agricultural Water Management, Elsevier, vol. 243(C).
    14. Fei, Rilong & Xie, Mengyuan & Wei, Xin & Ma, Ding, 2021. "Has the water rights system reform restrained the water rebound effect? Empirical analysis from China's agricultural sector," Agricultural Water Management, Elsevier, vol. 246(C).
    15. Fang, Lin & Zhang, Lin, 2020. "Does the trading of water rights encourage technology improvement and agricultural water conservation?," Agricultural Water Management, Elsevier, vol. 233(C).
    16. Jing Liu & Yu Zhang & Zhongbo Yu, 2018. "Evaluation of Physical and Economic Water-Saving Efficiency for Virtual Water Flows Related to Inter-Regional Crop Trade in China," Sustainability, MDPI, vol. 10(11), pages 1-10, November.
    17. Jing Liu & Mengyang Wu & Zhongbo Yu, 2018. "Evaluation of Environmental Impacts Due to Blue Water Consumption in China from Production and Consumption Perspectives," IJERPH, MDPI, vol. 15(11), pages 1-17, November.
    18. Li, Mo & Fu, Qiang & Singh, Vijay P. & Liu, Dong, 2018. "An interval multi-objective programming model for irrigation water allocation under uncertainty," Agricultural Water Management, Elsevier, vol. 196(C), pages 24-36.
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