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Political economy and political risks of institutional reform in the water sector

Author

Listed:
  • Dinar, Ariel
  • Balakrishnan, Trichur K.
  • Wambia, Joseph

Abstract

It is difficult and time-consuming to get adequate information about influence groups in a society. Dinar, Balakrishnan, and Wambia develop an approach to estimating the political risk associated with implementing a set of institutional reforms in the water sector. Their approach endogenizes the actions taken by politicians, users, service providers, and other stakeholders. Their analysis provides insights into the relationships between institutional arrangements, the power structure, and policy outcomes. T,he authors develop a two-tier tool to assess the risks associated with implementing reform. The first tier is a structured analysis of the distribution of power among groups interested in the outcome of reform. The second tier is a Delphi process, based on experts'opinions. Their approach is a compromise between the two options: the first (structured analysis) is costly and time-consuming and often entails creating and using pseudo precise indices; the second (Delphi) process is an unstructured"expert opinion"way of assessing risk Their compromise approach provides a manageable framework that, after some testing, could be added to the feasibility analysis of projects undertaken in politically complicated environments. They apply the approachto the National Drainage Program Project, currently in the early stages of implementation in Pakistan. They describe risk mitigation strategies that should be followed in dealing with political risks associated with the project.

Suggested Citation

  • Dinar, Ariel & Balakrishnan, Trichur K. & Wambia, Joseph, 1998. "Political economy and political risks of institutional reform in the water sector," Policy Research Working Paper Series 1987, The World Bank.
    • Handle: RePEc:wbk:wbrwps:1987
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    References listed on IDEAS

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    1. Susan Rose-Ackerman & Robert Evenson, 1985. "The Political Economy of Agricultural Research and Extension: Grants, Votes, and Reapportionment," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 67(1), pages 1-14.
    2. Morss, Elliott R., 1984. "Institutional destruction resulting from donor and project proliferation in Sub-Saharan African countries," World Development, Elsevier, vol. 12(4), pages 465-470, April.
    3. Eggertsson, Thrainn, 1997. "The old theory of economic policy and the new institutionalism," World Development, Elsevier, vol. 25(8), pages 1187-1203, August.
    4. Daniel W. Bromley, 1989. "Institutional Change and Economic Efficiency," Journal of Economic Issues, Taylor & Francis Journals, vol. 23(3), pages 735-759, September.
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    Cited by:

    1. Diao, Xinshen & Roe, Terry, 2003. "Can a water market avert the "double-whammy" of trade reform and lead to a "win-win" outcome?," Journal of Environmental Economics and Management, Elsevier, vol. 45(3), pages 708-723, May.
    2. Diao, Xinshen & Roe, Terry L., 1998. "The Effect of Sequencing Trade and Water Market Reform on Interest Groups in Irrigated Agriculture: An Intertemporal Economy-Wide Analysis of the Moroccan Case," Bulletins 7519, University of Minnesota, Economic Development Center.
    3. World Bank, 2008. "The Political Economy of Policy Reform : Issues and Implications for Policy Dialogue and Development Operations," World Bank Publications - Reports 7782, The World Bank Group.
    4. Javier Alarcón & Alberto Garrido & Luis Juana, 2014. "Managing Irrigation Water Shortage: a Comparison Between Five Allocation Rules Based on Crop Benefit Functions," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 28(8), pages 2315-2329, June.
    5. Peder Hjorth, 2001. "From insight to action in reservoir management—lessons from Asia," Natural Resources Forum, Blackwell Publishing, vol. 25(4), pages 313-320, November.

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