Value of Irrigation Water in Guadalquivir Basin (Spain) by Residual Value Method

Abstract

This paper presents an application of residual value techniques to the economic analysis of irrigation water at the basin level for the Guadalquivir River (Southern Spain). The methodology is simple; the results are robust and consistent with alternative method findings. The average residual value in the basin is 0.31 e/m 3 and according to the to Residual Value Method, the distribution of total Gross Value Added (GVA) of irrigated land is distributed between the different factors of production as follows: (i) water, 62% of GVA; (ii) land, 20% GVA (from rainfed productivity), (iii) return to man-made capital, 5% GVA; and finally (iv) the pair 'management + family-labour' gets 13% of total irrigation GVA. The paper illustrates the use of this method for the whole basin and it shows that it may offer promise for supporting sustainable water management at the basin (or the local) scale. It may be used for the implementation of the Water Framework Directive.

The Economic Analysis of Water Use in the Water Framework Directive Based on the System of Environmental-Economic Accounting for Water: A Case Study of the Guadalquivir River Basin

“…Exposito and Berbel [50] continue this analysis finding that irrigation water productivity in the basin has stagnated between 2005 and 2012. Berbel et al [51] also studied water productivity ratios, producing a similar figure for 2005. Borrego-Marín et al [31] study the productivity of water based on SEEA-Water methodology.…”

Microeconomics of Deficit Irrigation and Subjective Water Response Function for Intensive Olive Groves

“…Our research found that observed irrigation (2010-2013) in our high-intensity sample is 1103 m 3 /ha, that is, less than the allocated water rights but close to subjective economic optima considering water as a limited resource (with a theoretical solution of 1163 m 3 /ha). The regional or basin-level impact of deficit irrigation has been addressed by Berbel, Mesa-Jurado and Piston [20]. They found that for the Guadalquivir Basin, with over 800,000 irrigated ha, the global average RIS for all crops is estimated at 71%, with some crops such as citrus, fruits and rice receiving full irrigation while others such as wheat, cotton or olive groves are cultivated under deficit irrigation regimes.…”

Integration of hydrological and economic approaches to water and land management in Mediterranean climates: an initial case study in agriculture

“…The residual value method is also a technique applied to valuate water used as an intermediate input to production, when assigning appropriate prices to all inputs but one. Thus, the not accounted value of product is attributed to the residual input, i.e., water [see Young (2005), for a review of the use of this technique, and Berbel et al (2011), for an application in Spain].…”