WATER INCENT · Economic Instruments for Sustainable Water Management in Water Scarce and Drought Prone Irrigated Areas
Horizon 2020 — Marie Skłodowska-Curie Actions
- Duration
- 2015-06-01 → 2017-05-31
- EU contribution
- €168,277
- Participants
- 1
- Scheme
- MSCA-IF
Lines connect the coordinator with its partners.
Results in brief
Economic Instruments for Sustainable Water Management in Water Scarce and Drought Prone Irrigated Areas
More than 50% of total water abstractions in Southern Europe come from the agricultural sector, rising to more than 80% in some regions. Water abstractions are particularly high and fast growing in profitable irrigated areas in the Mediterranean Basin, where agricultural demand enters in direct competition with basic environmental services increasingly often. Urgent action is needed to address this unsustainable trade-off. Economic instruments represent a means of adapting demand to collectively agreed goals and thus relief pressure over stressed EU water bodies. In particular, recent water resources research has put forward the role that can be played by agricultural water markets and drought insurance for irrigated agriculture. These two instruments have been already tested (markets) or at least explored (insurance) in a EU context, but it is still unclear what can be expected from them. Results show that conventional approaches to water scarcity and drought management in selected case study areas is neither efficient nor cost-effective. Relevant economic gains can be obtained from the implementation of markets and drought insurance to reap existent welfare-enhancing opportunities. The research also shows analytically how economic instruments can be developed in the case study areas attending to the institutional and legal setting and potential resistance from those negatively impacted by the reform. In this vein, different alternatives for implementing water policy reforms are assessed (e.g. water markets and buyback).
Data: CORDIS, © European Union
Project objective
More than 50% of total water abstractions in Southern Europe come from the agricultural sector, rising to more than 80% in some regions. Water abstractions are particularly high and fast growing in profitable irrigated areas in the Mediterranean Basin, where agricultural demand enters in direct competition with basic environmental services increasingly often. Urgent action is needed to address this unsustainable trade-off. Economic instruments represent a means of adapting demand to collectively agreed goals and thus relief pressure over stressed EU water bodies. In particular, recent water resources research has put forward the role that can be played by agricultural water markets and drought insurance for irrigated agriculture. These two instruments have been already tested (markets) or at least explored (insurance) in a EU context, but it is still unclear what can be expected from them. The objective of my research is advancing in the design and development of agricultural water markets and insurance systems that contribute to the implementation of an effective and efficient water policy mix in the EU. In a first stage I will develop quantitative methods using Revealed Preferences Models and Agent Based Models to estimate the economic and environmental outcomes of the proposed instruments under different scenarios. In the second stage I will use an analytical framework to critically assess the efficiency and effectiveness of drought insurance and water markets in a wider policy context. Theoretical constructions will be illustrated with empirical applications in the Po River Basin District (RBD) in Italy and the Segura RBD in Spain.
Original text from CORDIS.
Participants
- FONDAZIONE ENI ENRICO MATTEI · MilanoCoordinatorItaly
Links
Data: CORDIS, © European Union