Publication: Assessing the Direct Economic Effects of Reallocating Irrigation Water
to Alternative Uses : Concepts and an Application
Loading...
Date
2011-09-01
ISSN
Published
2011-09-01
Author(s)
Editor(s)
Abstract
Irrigation water reallocations are playing an increasingly important role in both developed and developing countries. With growing urban and environmental water demands, rising costs for the development of new water supplies, and irrigated agriculture usually including the least economically valuable use of water, transfers of irrigation water to alternative uses are increasing. However, such reallocations are often controversial, and it is often questioned whether the benefits resulting from these transactions are large enough to outweigh the associated costs. This paper reviews the experience with irrigation water transfers, including the involvement of the World Bank. It discusses the problems of assessing the direct economic effects of reallocations, with a focus on the foregone direct benefits in irrigated agriculture. Because foregone direct benefits cannot easily be directly observed, they need to be estimated. However, assessments have shown widely differing estimates -- even when the same methodology was used. The paper reviews the methodologies and model specifications used for estimating foregone direct benefits; illustrates the impact of different model specifications on the magnitude of estimates of foregone direct benefits based on an application in an example case; and draws conclusions with regard to future efforts in assessing reallocation effects, including calculating adequate compensation for farmers. Because estimating the direct benefits of irrigation expansion is methodologically equivalent to estimating foregone direct benefits from reduced irrigation water supplies, the findings have implications for a broader range of water allocation decisions.
Link to Data Set
Citation
“Scheierling, Susanne M.. 2011. Assessing the Direct Economic Effects of Reallocating Irrigation Water
to Alternative Uses : Concepts and an Application. Policy Research working paper ; no. WPS 5797. © World Bank. http://hdl.handle.net/10986/3561 License: CC BY 3.0 IGO.”
Associated URLs
Associated content
Other publications in this report series
Publication Geopolitics and the World Trading System(Washington, DC: World Bank, 2024-12-23)Until the beginning of this century, the GATT/WTO system worked. Economic research provided a compelling explanation. It showed that if governments maximize the well-being of their own countries broadly defined, GATT/WTO principles would facilitate mutually beneficial cooperation over their trade policy choices. Now heightened geopolitical rivalry seems to have undermined the WTO. A simple transposition of the previous rationalization suggests that geopolitics and trade cooperation are not compatible. The paper shows that this is only true if rivalry eclipses any consideration of own-country well-being. In all other circumstances, there are gains from trade cooperation even with geopolitics. Furthermore, the WTO’s relevance is in question only if it adheres too rigidly to its existing rules and norms. Through measured adaptation to the geopolitical imperative, the WTO can continue to thrive as a forum for multilateral trade cooperation in the age of geopolitics.Publication The Macroeconomic Implications of Climate Change Impacts and Adaptation Options(Washington, DC: World Bank, 2025-05-29)Estimating the macroeconomic implications of climate change impacts and adaptation options is a topic of intense research. This paper presents a framework in the World Bank's macrostructural model to assess climate-related damages. This approach has been used in many Country Climate and Development Reports, a World Bank diagnostic that identifies priorities to ensure continued development in spite of climate change and climate policy objectives. The methodology captures a set of impact channels through which climate change affects the economy by (1) connecting a set of biophysical models to the macroeconomic model and (2) exploring a set of development and climate scenarios. The paper summarizes the results for five countries, highlighting the sources and magnitudes of their vulnerability --- with estimated gross domestic product losses in 2050 exceeding 10 percent of gross domestic product in some countries and scenarios, although only a small set of impact channels is included. The paper also presents estimates of the macroeconomic gains from sector-level adaptation interventions, considering their upfront costs and avoided climate impacts and finding significant net gross domestic product gains from adaptation opportunities identified in the Country Climate and Development Reports. Finally, the paper discusses the limits of current modeling approaches, and their complementarity with empirical approaches based on historical data series. The integrated modeling approach proposed in this paper can inform policymakers as they make proactive decisions on climate change adaptation and resilience.Publication Global Poverty Revisited Using 2021 PPPs and New Data on Consumption(Washington, DC: World Bank, 2025-06-05)Recent improvements in survey methodologies have increased measured consumption in many low- and lower-middle-income countries that now collect a more comprehensive measure of household consumption. Faced with such methodological changes, countries have frequently revised upward their national poverty lines to make them appropriate for the new measures of consumption. This in turn affects the World Bank’s global poverty lines when they are periodically revised. The international poverty line, which is based on the typical poverty line in low-income countries, increases by around 40 percent to $3.00 when the more recent national poverty lines as well as the 2021 purchasing power parities are incorporated. The net impact of the changes in international prices, the poverty line, and new survey data (including new data for India) is an increase in global extreme poverty by some 125 million people in 2022, and a significant shift of poverty away from South Asia and toward Sub-Saharan Africa. The changes at higher poverty lines, which are more relevant to middle-income countries, are mixed.Publication Global Socio-economic Resilience to Natural Disasters(Washington, DC: World Bank, 2025-05-22)Most disaster risk assessments use damages to physical assets as their central metric, often neglecting distributional impacts and the coping and recovery capacity of affected people. To address this shortcoming, the concepts of well-being losses and socio-economic resilience—the ability to experience asset losses without a decline in well-being—have been proposed. This paper uses microsimulations to produce a global estimate of well-being losses from, and socio-economic resilience to, natural disasters, covering 132 countries. On average, each $1 in disaster-related asset losses results in well-being losses equivalent to a $2 uniform national drop in consumption, with significant variation within and across countries. The poorest income quintile within each country incurs only 9% of national asset losses but accounts for 33% of well-being losses. Compared to high-income countries, low-income countries experience 67% greater well-being losses per dollar of asset losses and require 56% more time to recover. Socio-economic resilience is uncorrelated with exposure or vulnerability to natural hazards. However, a 10 percent increase in GDP per capita is associated with a 0.9 percentage point gain in resilience, but this benefit arises indirectly—such as through higher rate of formal employment, better financial inclusion, and broader social protection coverage—rather than from higher income itself. This paper assess ten policy options and finds that socio-economic and financial interventions (such as insurance and social protection) can effectively complement asset-focused measures (e.g., construction standards) and that interventions targeting low-income populations usually have higher returns in terms of avoided well-being losses per dollar invested.Publication From Patriarchy to Policy(Washington, DC: World Bank, 2025-05-29)Legal institutions play an important role in shaping gender equality in economic domains, from inheritance to labor markets. But where do gender equal laws come from? Using cross-country data on social norms and legal equality, this paper investigates the socio-cultural roots of gender inequity in the legal system and its implications for female labor force participation. To identify the impact of social norms, the analysis uses an empirical strategy that exploits pre-modern differences in ancestral patriarchal culture as an instrument for present-day gender norms. The findings show that ancestral patriarchal culture is a strong predictor of contemporary norms, and conservative social norms are associated with more gender inequality in the de jure legal framework, the de facto implementation of laws, and the labor market. The paper presents evidence for a political selection mechanism linking norms to laws: countries with more conservative norms elect political leaders who are more hostile to gender equality, who then pass less progressive legislation. The results highlight the cultural roots and political drivers of legalized gender inequality.
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication How to Assess Agricultural Water Productivity? Looking for Water in the Agricultural Productivity and Efficiency Literature(World Bank Group, Washington, DC, 2014-07)Given population and income growth, it is widely expected that the agricultural sector will have to expand the use of water for irrigation to meet rising food demand; at the same time, the competition for water resources is growing in many regions. As a response, it is increasingly recommended that efforts should focus on improving water productivity in agriculture, and significant public and private investments are being made with this goal in mind. Yet most public communications are vague on the meaning of agricultural water productivity, and on what should be done to improve it. They also tend to emphasize water as if it were the only input that mattered. This paper presents findings from a first attempt to survey the agricultural productivity and efficiency literature with regard to the explicit inclusion of water aspects in productivity and efficiency measurements, with the aim of contributing to the discussion on how to assess and possibly improve agricultural water productivity. The focus is on studies applying single-factor productivity measures, total factor productivity indices, frontier models, and deductive models that incorporate water. A key finding is that most studies either incorporate field- and basin-level aspects but focus only on a single input (water), or they apply a multi-factor approach but do not tackle the basin level. It seems that no study on agricultural water productivity has yet presented an approach that accounts for multiple inputs and basin-level issues. However, deductive methods do provide the flexibility to overcome many of the limitations of the other methods.Publication Modeling for Watershed Management(World Bank, Washington, DC, 2010-06)Watershed management problems are usually quite diverse, and involve a wide range of biological, geological, chemical, and physical processes with complex human, social, and economic contexts. The working note seeks to show that computer modeling allows us to better organize, test, and refine our thinking about watershed management problems and potential solutions. Typically, the flow of water leads modeling to be organized into the following areas: (i) precipitation and climate models; (ii) precipitation-runoff models; (iii) stream and aquifer models; (iv) infrastructure operations models; (v) economic, agronomic, social, environmental demand and performance models; and (vi) decision-making models. Selecting the right model to apply to specific problems requires that several factors be considered along with the objectives for modeling in the context of the field decision problem. Key factors include understandability, development and application time, resources required, transferability and maintenance. Good modeling is common-sense and understanding reduced to calculation for the purposes of gaining insights into a real problem. Modeling should aid discussions, help thinking and provide insights to problems where individuals and interests struggle to understand the problem and struggle to work together to address a problem. To aid model development and the interpretation and communication of modeling and model results and insights, simplicity is a great virtue. While complex problems sometimes require complex models, shedding of unneeded complexity is important. Local and in-house expertise is preferred when developing and applying watershed models because of better familiarity with the problems assessed. Model integration is a growing trend but requires as much expertise and resources as development of any single model component.Publication Water Security for Central Kosovo(Washington, DC, 2012-03)Kosovo is a small and young state that gained an interim United Nations (UN)-administered status in the wake of the Dayton peace accord only in 1999; it declared independence in 2008. Compared to neighboring countries, it is still lacking in its basic infrastructure and its administrative and technical skills. In addition, with the onset of the War in Yugoslavia in 1992 most investment and normal maintenance came to a standstill. Much of the publicly owned infrastructure fell into disrepair or was vandalized, but private investments led to a construction boom which, however, is leading to many environmental problems. The government is committed to reconstruction and to the development of a peaceful state. It also intends to align with EU policies. Thus, the study has the specific objectives to: (i) assist the government to improve its river basin planning and management by providing (for demonstration purposes) a replicable tool and simulation model for integrated river basin planning and management; and (ii) support the government in its identification of priority measures of structural and non-structural nature to help strengthen the water resources sector performance. The source(s) for the financing of the identified projects will need to be identified further by the Government as the World Bank has not committed to involvement in the sector.Publication Agenda for Water Sector Strategy for North China : Volume 2. Main Report(Washington, DC, 2001-04-02)The acute water shortage, and pollution problems in North China have been exacerbated by the continued population growth, and the accelerated industrial expansion over the past half-century, conducive to increasingly severe freshwater shortages, and catastrophic consequences for the future. Significant commitments need to be made to rapidly implement strategies to bring water resource utilization back into a sustainable balance. The report reviews past and present situations, focusing on the future impacts of various social, and economic growth scenarios within the context of water management, where preconditions for its success are the combined requirements of complementary pricing, management, and regulatory reforms in water resources (including groundwater, water pollution, and wastewater reuse). Findings suggest a water demand management as proposed in the action plan - with further water price increases, and improving irrigation efficiency. Agricultural productivity depends on irrigation efficiency, thus water management calls for water-savings measures, low-yield land improvement, and, large-scale systems rehabilitation. Structural water pollution remedy measures, should focus on industrial wastewater pretreatment, and internal reuse of processed water, pollution prevention programs, and combined industrial, and municipal treatment plants, to include as well artificial groundwater recharge (wastewaters and floodwaters). Institutional aspects will require further strengthening, regarding water resource allocation, protection, and financing.Publication Economics of Adaptation to Climate Change : Mozambique, Volume 2. Annexes(Washington, DC, 2010)This report is part of a broader global study, the Economics of Adaptation to Climate Change (EACC), which has two principal objectives: (a) to develop a global estimate of adaptation costs for informing international climate negotiations; and (b) to help decision makers in developing countries assess the risks posed by climate change and design national strategies for adapting to it. The purpose of this study is to assist the Government of Mozambique in its efforts to understand the potential economic impacts of climate change and to support its efforts to develop sound policies and investments in response to these potential impacts. The Mozambique Economics of Adaptation to Climate Change (EACC) study selected four sectors that are believed to be vulnerable to climate change: (1) agriculture, which employs over 70 percent of the population; (2) energy, particularly hydropower generation, which is dependent on water runoff; (3) transport infrastructure, notably roads; and (4) coastal areas, which do not conform to a "sector" but characterize specific geographical areas vulnerable to floods and storm surges directly and indirectly related to sea level rise. The report ends with a discussion of seven lessons learned from the study. Volume 1contains the final report, and Volume 2 contains the Annexes,
Users also downloaded
Showing related downloaded files
Publication Classroom Assessment to Support Foundational Literacy(Washington, DC: World Bank, 2025-03-21)This document focuses primarily on how classroom assessment activities can measure students’ literacy skills as they progress along a learning trajectory towards reading fluently and with comprehension by the end of primary school grades. The document addresses considerations regarding the design and implementation of early grade reading classroom assessment, provides examples of assessment activities from a variety of countries and contexts, and discusses the importance of incorporating classroom assessment practices into teacher training and professional development opportunities for teachers. The structure of the document is as follows. The first section presents definitions and addresses basic questions on classroom assessment. Section 2 covers the intersection between assessment and early grade reading by discussing how learning assessment can measure early grade reading skills following the reading learning trajectory. Section 3 compares some of the most common early grade literacy assessment tools with respect to the early grade reading skills and developmental phases. Section 4 of the document addresses teacher training considerations in developing, scoring, and using early grade reading assessment. Additional issues in assessing reading skills in the classroom and using assessment results to improve teaching and learning are reviewed in section 5. Throughout the document, country cases are presented to demonstrate how assessment activities can be implemented in the classroom in different contexts.Publication World Development Report 2011(World Bank, 2011)The 2011 World development report looks across disciplines and experiences drawn from around the world to offer some ideas and practical recommendations on how to move beyond conflict and fragility and secure development. The key messages are important for all countries-low, middle, and high income-as well as for regional and global institutions: first, institutional legitimacy is the key to stability. When state institutions do not adequately protect citizens, guard against corruption, or provide access to justice; when markets do not provide job opportunities; or when communities have lost social cohesion-the likelihood of violent conflict increases. Second, investing in citizen security, justice, and jobs is essential to reducing violence. But there are major structural gaps in our collective capabilities to support these areas. Third, confronting this challenge effectively means that institutions need to change. International agencies and partners from other countries must adapt procedures so they can respond with agility and speed, a longer-term perspective, and greater staying power. Fourth, need to adopt a layered approach. Some problems can be addressed at the country level, but others need to be addressed at a regional level, such as developing markets that integrate insecure areas and pooling resources for building capacity Fifth, in adopting these approaches, need to be aware that the global landscape is changing. Regional institutions and middle income countries are playing a larger role. This means should pay more attention to south-south and south-north exchanges, and to the recent transition experiences of middle income countries.Publication Europe and Central Asia Economic Update, Fall 2024: Better Education for Stronger Growth(Washington, DC: World Bank, 2024-10-17)Economic growth in Europe and Central Asia (ECA) is likely to moderate from 3.5 percent in 2023 to 3.3 percent this year. This is significantly weaker than the 4.1 percent average growth in 2000-19. Growth this year is driven by expansionary fiscal policies and strong private consumption. External demand is less favorable because of weak economic expansion in major trading partners, like the European Union. Growth is likely to slow further in 2025, mostly because of the easing of expansion in the Russian Federation and Turkiye. This Europe and Central Asia Economic Update calls for a major overhaul of education systems across the region, particularly higher education, to unleash the talent needed to reinvigorate growth and boost convergence with high-income countries. Universities in the region suffer from poor management, outdated curricula, and inadequate funding and infrastructure. A mismatch between graduates' skills and the skills employers are seeking leads to wasted potential and contributes to the region's brain drain. Reversing the decline in the quality of education will require prioritizing improvements in teacher training, updated curricula, and investment in educational infrastructure. In higher education, reforms are needed to consolidate university systems, integrate them with research centers, and provide reskilling opportunities for adult workers.Publication Digital Progress and Trends Report 2023(Washington, DC: World Bank, 2024-03-05)Digitalization is the transformational opportunity of our time. The digital sector has become a powerhouse of innovation, economic growth, and job creation. Value added in the IT services sector grew at 8 percent annually during 2000–22, nearly twice as fast as the global economy. Employment growth in IT services reached 7 percent annually, six times higher than total employment growth. The diffusion and adoption of digital technologies are just as critical as their invention. Digital uptake has accelerated since the COVID-19 pandemic, with 1.5 billion new internet users added from 2018 to 2022. The share of firms investing in digital solutions around the world has more than doubled from 2020 to 2022. Low-income countries, vulnerable populations, and small firms, however, have been falling behind, while transformative digital innovations such as artificial intelligence (AI) have been accelerating in higher-income countries. Although more than 90 percent of the population in high-income countries was online in 2022, only one in four people in low-income countries used the internet, and the speed of their connection was typically only a small fraction of that in wealthier countries. As businesses in technologically advanced countries integrate generative AI into their products and services, less than half of the businesses in many low- and middle-income countries have an internet connection. The growing digital divide is exacerbating the poverty and productivity gaps between richer and poorer economies. The Digital Progress and Trends Report series will track global digitalization progress and highlight policy trends, debates, and implications for low- and middle-income countries. The series adds to the global efforts to study the progress and trends of digitalization in two main ways: · By compiling, curating, and analyzing data from diverse sources to present a comprehensive picture of digitalization in low- and middle-income countries, including in-depth analyses on understudied topics. · By developing insights on policy opportunities, challenges, and debates and reflecting the perspectives of various stakeholders and the World Bank’s operational experiences. This report, the first in the series, aims to inform evidence-based policy making and motivate action among internal and external audiences and stakeholders. The report will bring global attention to high-performing countries that have valuable experience to share as well as to areas where efforts will need to be redoubled.Publication World Development Report 2006(Washington, DC, 2005)This year’s Word Development Report (WDR), the twenty-eighth, looks at the role of equity in the development process. It defines equity in terms of two basic principles. The first is equal opportunities: that a person’s chances in life should be determined by his or her talents and efforts, rather than by pre-determined circumstances such as race, gender, social or family background. The second principle is the avoidance of extreme deprivation in outcomes, particularly in health, education and consumption levels. This principle thus includes the objective of poverty reduction. The report’s main message is that, in the long run, the pursuit of equity and the pursuit of economic prosperity are complementary. In addition to detailed chapters exploring these and related issues, the Report contains selected data from the World Development Indicators 2005‹an appendix of economic and social data for over 200 countries. This Report offers practical insights for policymakers, executives, scholars, and all those with an interest in economic development.