Factors influencing farmers’ willingness to participate in water allocation trading. A case study in southern Spain
Author
Giannoccaro, Giacomo
Castillo, Manuela
Berbel, Julio
Publisher
INIADate
2016Subject
Contingent valuationIrrigation
Farmer's attitude
Heckman model
Water markets
METS:
Mostrar el registro METSPREMIS:
Mostrar el registro PREMISMetadata
Show full item recordAbstract
This study aims to uncover the factors that influence farmers’ attitudes towards water allocation trading. In the study, we simulate
two water availability scenarios, an average year and a drought year, in a contingent valuation experiment with 241 farmers. A
survey was held in the spring of 2012 in the Guadalquivir and Almanzora River Basins. First, we estimated a multinomial logit
model to determine the factors that influence farmers to decide to participate in our hypothetical market. We then analysed the
structural and socio-economic factors determining the monetary value of traded water using Heckman’s two-step model. Our results
indicate that those farmers who are more innovative and have had agricultural training show a higher willingness to participate in
water trading. Additionally, low water-supply guarantee and appropriate information about seasonal water availability increase the
probability of participation. Higher willingness to pay (WTP) for water is found in horticulture and among farmers who grow citrus
and other permanent crops; lower water selling value (WTA) is found in farms with extensive annual crops and traditional olive
groves. However, monetary values (WTP/WTA) are strongly dependent on the current cost of irrigation water services. While findings
of this research seem to support the idea of diffusion innovation theory, the existence of ethical concerns that might influence
farmers’ acceptance of irrigation water markets needs further analysis