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Feedback links between economy-wide and farm-level policies : application to irrigation water management in Morocco

Author:	Roe, Terry; Dinar, Ariel; Tsur, Yacov; Xinshen Diao;	Collection Title:	Policy, Research working paper ; no. WPS 3550
Country:	Morocco;	Date Stored:	2005/03/31
Document Date:	2005/03/01	Document Type:	Policy Research Working Paper
Language:	English	Region:	Middle East and North Africa
Report Number:	WPS3550	SubTopics:	Environmental Economics & Policies; Water Conservation; Town Water Supply and Sanitation; Water and Industry; Water Supply and Sanitation Governance and Institutions
Volume No:	1 of 1

Summary: The authors focus on policy interventions for improving irrigation water allocation decisions by including both macro and micro considerations in a unified analytical computable general equilibrium (CGE) framework. The approach is demonstrated, using the case of Morocco, by analyzing selected policy (top-down and bottom-up) interventions and external shocks that affect the water sector. Both direct and indirect effects of these interventions are identified. The top-down (macro-to-micro) links are of a trade reform type. The bottom-up (micro-to-macro) links pertain to changes in farm water assignments and the possibility of water trading. The authors find that water productivity is strongly influenced by these policies, with the general equilibrium (indirect) effects modifying and sometimes reversing the partial equilibrium (direct) effects. They also find that the impacts of the two reforms assessed are different, with trade reform having an absolute impact of a higher magnitude than the water reform. Finally, the authors show that the sequence of introducing the policy reforms has different consequences.


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