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Is Equity A Constraint? Applications To Block Rate And Other Pricing Schemes With Heterogeneous Users

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  • Schoengold, Karina
  • Zilberman, David

Abstract

In this paper, we model the trade-off between equity and efficiency in a market for a resource when users of that resource are heterogeneous. We develop the analytical model, and show that under certain circumstances efficiency can be achieved in a manner that also reduces inequality. We also illustrate these results through the use of simulation methods.

Suggested Citation

  • Schoengold, Karina & Zilberman, David, 2004. "Is Equity A Constraint? Applications To Block Rate And Other Pricing Schemes With Heterogeneous Users," 2004 Annual meeting, August 1-4, Denver, CO 19945, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea04:19945
    DOI: 10.22004/ag.econ.19945
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    References listed on IDEAS

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    1. Burness, H Stuart & Quirk, James P, 1979. "Appropriative Water Rights and the Efficient Allocation of Resources," American Economic Review, American Economic Association, vol. 69(1), pages 25-37, March.
    2. Schoengold, Karina & Zilberman, David, 2007. "The Economics of Water, Irrigation, and Development," Handbook of Agricultural Economics, in: Robert Evenson & Prabhu Pingali (ed.), Handbook of Agricultural Economics, edition 1, volume 3, chapter 58, pages 2933-2977, Elsevier.
    3. Ferguson, Carol A., 1992. "Water allocation, inefficiency and inequity in a government irrigation system," Journal of Development Economics, Elsevier, vol. 38(1), pages 165-182, January.
    4. Margriet F. Caswell & David Zilberman, 1986. "The Effects of Well Depth and Land Quality on the Choice of Irrigation Technology," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 68(4), pages 798-811.
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