Regresar

An application of the Contingent Valuation Method to assess the efficiency of the institutional structure of irrigation property rights: The case of the Peninsula of Santa Elena, Ecuador

Abstract:

Many of the observed problems of water management in developing countries are linked to inefficient institutional structures of property rights. This is particularly the case with many public irrigation systems that have never achieved the expected social and economic benefits. In this paper it is argued that the Contingent Valuation Method (CVM) can be applied to evaluate the degree of inefficiency of such institutional structure for the case of one of the most important irrigation systems in Ecuador in the Peninsula of Santa Elena (PSE). The procedure applied consists of eliciting an economic value among irrigators. Thus, Willingness to Pay (WTP) questions are used to value a specific outcome of a policy intended to assure the right to have an efficient management of the canals. The evaluation criterion consists of comparing the resulting economic value with the price currently charged to irrigators. Any deviation is considered an economic rent which is wasted. Thus, CVM is used to investigate the potential benefits of a hypothetical change in the existing property rights structure. The estimation results assert that the proposed change would provide positive net benefits to water users in the PSE. © 2004 Taylor & Francis Ltd.