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Short and Long term Effects of Water Markets

Author

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  • Rim Lahmandi-Ayed

    (UR MASE - Modélisation et Analyse Statistique et Economique - ESSAIT - Ecole Supérieure de la Statistique et de l'Analyse de l'Information - UCAR - Université de Carthage (Tunisie))

  • Mohamed Salah Matoussi

    (Université de Tunis)

Abstract

We aim at checking from a theoretical viewpoint the claims made about water markets in the literature. We prove that water markets improve farmers' profits and production efficiency but do not necessarily improve total production and do not always encourage private investments. Taking into account the transaction cost of water markets and the social cost due to the inactivity of some farmers that may result from water markets, we prove that water markets do not always improve total surplus. JEL Classification: Q25, C72, O33.

Suggested Citation

  • Rim Lahmandi-Ayed & Mohamed Salah Matoussi, 2018. "Short and Long term Effects of Water Markets," Working Papers hal-01863372, HAL.
    • Handle: RePEc:hal:wpaper:hal-01863372
    Note: View the original document on HAL open archive server: https://hal.science/hal-01863372
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    References listed on IDEAS

    as
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    2. Phoebe Koundouri & Panos Pashardes & Timothy Swanson & Anastasios Xepapadeas, "undated". "The Economics of Water Management in Developing Countries Problems, Principles and Policies," DEOS Working Papers 0303, Athens University of Economics and Business.
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    More about this item

    Keywords

    Water markets; Water scarcity; Production efficiency; Total production; Private investment; Social costs; Transaction costs;
    All these keywords.

    JEL classification:

    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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