Abstract
The purpose of this paper is to understand the progress of water rights and irrigation pricing reform in Heihe River Basin (HRB) and their influence on irrigation application. The data came from a village and household level survey conducted in 2009 and 2014 in five counties in Zhangye City, HRB. The main component of reforming water rights was issuing water certificates to individual farmers. However, the share of villages that have done so dropped from 70% in 2004 to 28% in 2014. Water pricing reform raised the price of water. For the pricing of surface water, which consists of an area-based fee and a volumetric price, the volumetric price was increased. Econometric results show that amending water rights substantially reduced irrigation application in the early stage of reform (by 2009) but not in the later phase (by 2014). In contrast, higher water prices lowered irrigation applications significantly at both the early and later stages. Further analysis indicates that due to ineffective implementation, high cost of implementation due to large number of farmers, variations in water supply from year to year, and small farm sizes, little benefit is gained from trading. All of these factors played a role in the failure of water rights reforms.
Highlights
Expanding irrigation in the 20th century has resulted in serious degradation of the ecological environment in China’s Heihe River Basin (HRB)
We identified agricultural water rights reform and irrigation pricing policy
The goodness of fit measures are around 0.3, which sit at the upper end of the range of R2 s observed in empirical analysis that use household level repeated cross sectional or longitudinal survey data
Summary
Expanding irrigation in the 20th century has resulted in serious degradation of the ecological environment in China’s Heihe River Basin (HRB). With the low levels of annual precipitation at around mm, agricultural production in the HRB depends heavily on irrigation. Most of the agricultural production occurs in the midstream of the HRB and takes up as much as 90% of total water use. From 1950 to 2000, irrigated areas in the HRB have increased from 100,000 to 300,000 ha The runoff downstream has declined from 1.5 billionm in the 1950s to about. The number of days during which Heihe River is dry increased from 100 to 200 days [2,3]. Other consequences include declining groundwater levels and the deterioration of water quality. About 50% of the available land degraded from wetlands and grasslands to desert and salt marshes, which grew by 8660 ha per year [2,3,4]
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