A Net-back Analysis of Irrigation Water Demand in East Anglia

摘要

In the United Kingdom, water allocation is governed by an administered licensing system, with charges unrelated to economic or environmental costs. Such a system is unlikely to result in an economically optimal allocation of water because it takes no account of the costs and benefits of each water use. However, the efficiency of the system can be improved by performing a "net- back" analysis. This paper performs a net-back analysis on irrigation water demand in the East Anglia region of the U.K. First, the simple net-back model is introduced, before existing data is used to estimate farmers' willingness to pay for irrigation water, both with and without the effects of agricultural and trade subsidies.