Understanding the Direct and Indirect Effects of Water Policy for Better Policy Decision Making: An Application to Irrigation Water Management in Morocco

Water policy is prone to error because of the complexity of irrigated agriculture. Agriculture is spatially dependent, it exists in the context of a nation's economy with which it must compete for resources, and water markets seldom exist. The process of collective action, as Douglas North has noted, typically involves a process that places emphasis on the direct effects of a policy outcome. The constraints of collective action tend to be such that this process is not capable of "solving" the simultaneous equations of a real economy as a decentralized market mechanism can be characterized as being able to perform. The contribution of the paper is to measure the direct and indirect effects of irrigation water policy in an economy-wide context for the case of Morocco, and to show that the sequence of reform is important. The framework entails a model of agriculture in the context of the broader economy, with particular attention given its spatial dimension, and its forward and backward linkages in order to better capture its complexities. Morocco is a particularly interesting example due to its trade policy, its relatively regionalized policy decision making for allocating irrigation water to farmers, and the use of renewable water from seasonal snow melt as opposed to the more complex conjunctive use of ground water for irrigation found in many countries.