Bargaining rules for a thin spot water market

Markets for water rights have been advocated to resolve user conflicts and to improve efficiency. The potential for efficiency gains from market allocation of water has been well established. Most studies of water markets address the transferability of long-term water rights, i.e., base or property...

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Bibliographic Details
Published in:Land economics 1991-08, Vol.67 (3), p.326-339
Main Authors: Saleth, R.M. (Indira Gandhi Institute of Development Research, Bombay, India), Braden, J.B, Eheart, J.W
Format: Article
Language:English
Subjects:
AGUA DE RIEGO
Bargaining
BASSIN VERSANT
CUENCAS HIDROGRAFICAS
Deadweight loss
DERECHO DE AGUAS
DERECHO DE USO
DROIT D'USAGE
EAU D'IRRIGATION
Economic aspects
Economic models
Economics
EFFICACITE
EFFICIENCY
Efficient markets
EFICACIA
Farm economics
FARM SIZE
Farms
GAME THEORY
ILLINOIS
IRRIGATION WATER
KANKAKEE COUNTY, ILLINOIS
MAIS
MAIZ
MAIZE
MARCHE
Market
Market prices
Market size
MARKETS
MERCADOS
Mineral rights
MODELE DE SIMULATION
MODELOS DE SIMULACION
MULTILATERAL BARGAINING MODELS
Multilateralism
Nash equilibrium
Negotiation
Public services
REGLEMENTATION DES EAUX
RENDEMENT
RENDIMIENTO
RIGHT OF ACCESS
SIMULATION MODELS
Statistical analysis
Supply & demand
TAILLE DE L'EXPLOITATION AGRICOLE
TAMANO DE LA FINCA
Water
Water markets
Water resources
WATER RIGHTS
Water supply
WATERSHEDS
YIELDS
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Description
Summary:Markets for water rights have been advocated to resolve user conflicts and to improve efficiency. The potential for efficiency gains from market allocation of water has been well established. Most studies of water markets address the transferability of long-term water rights, i.e., base or property rights. However, rental or spot markets for water can improve efficiency by allowing allocational adjustments in line with changing conditions without disturbing the base rights system. Exchanges of either base or spot rights that entail a change in the point of diversion may result in third-party effects, even in the absence of return flow problems. Such third-party effects place practical limits on the geographic scope of water exchanges and result in a thin market, i.e., a market with few eligible participants. Multilateral bargaining models based on a game theoretic approach are used to address bargaining rules that will facilitate the efficient operation of a thin water market.
ISSN:0023-7639
1543-8325
DOI:10.2307/3146428