Pricing China's irrigation water

Abstract

Many development agencies and other actors are advocating that China adopt a system of water markets or of high water prices in order to resolve the inefficiencies of irrigation agriculture and to supply sufficient water for growing urban and industrial uses. We argue that this proposal rests on a series of propositions: that the price of water is too low to encourage farmers to be efficient; that farmers are not charged volumetric prices and so are not encouraged to conserve water; that water is scarce largely because farmers are profligate in their use of water; and that proper pricing of water will not affect equity. None of these contentions is true. Farmers have to pay not only the offi..