How could we realize a win–win strategy on irrigation price policy? Evaluation of a pilot reform project in Hebei Province, China

Abstract

s u m m a r yThe challenge of increasing irrigation prices while increasing farmers' income exists not only in China but in other countries as well. The overall goal of this paper is to evaluate whether a win-win strategy can be realized in a pilot reform in Hebei, China. The data came from a two-round field survey in 2009 and 2012, which indicated that the key mechanism of the pilot reform was that farmers received similar returns (including reallocated, increased irrigation fees and a government subsidy), but paid different irrigation fees; the difference between the returned money and payment was treated as an incentive for farmers to reduce their use of irrigation. The econometric results showed that in pilot reformed villages, local farmers' groundwater application for irrigating wheat and cotton could decrease by 21% each. If no subsidies are granted, roughly half of the region's farmers would lose money due to the reform. However, most farmers who receive subsidies were able to earn money in the pilot reformed villages. If several issues are properly resolved (such as selecting more representative villages, increasing the subsidy value, and negatively linking the subsidy with water use), it would be possible for more regions to realize a win-win price reform strategy.

Estimation of Irrigation Water Demand and Economic Returns of Water in Zhangye Basin

“…When government makes irrigation pricing policies, it ought to take the economic returns of irrigation water into account. On one hand, water price should reach or exceed its economic returns, in order to reduce their irrigation application under the more sensitive price elasticities of irrigation water demand; on the other hand, the corresponding compensation of water price should be implemented after irrigation fee collection, such as the precision subsidy mechanism of irrigation price [11,66], considering water price has exceed economic returns of water, which can alleviate farmers' burdens. In the system, a high water price can have an incentive effect on water conservation during irrigation, and the subsidy after irrigation (usually at the end of year) can make the actual irrigation cost finally payed by farmers not rise, which results in a win-win strategy with regard to irrigation price policy.…”

How to Meter Agricultural Pumping at Numerous Small-Scale Wells?—An Indirect Monitoring Method Using Electric Energy as Proxy

“…Even in a quota system water fees can be collected proportional to electricity fees if overpayment is reimbursed according to quota at the end of the irrigation season. A system known as "pay first and get reimbursed later" has been experimented with in several villages of Hebei province [39,40].…”

China’s Water-Saving Irrigation Management System: Policy, Implementation, and Challenge

“…Hence, it is impossible for the policy-makers to increase water prices without hurting rural incomes [47] while maintaining food security [5]. Even with subsidy strategies to compensate famers' lost income because of increasing water prices, as in a pilot area of Taocheng District [72,73], there is still a significant shift in plantation structure from the traditional grain crops to the water-saving and high-value crops [74,75].…”