05 August 2014

Groundwater governance -- carrots or sticks?

MGC copied me on an an email he sent to a student:
With 150 million farmers and around 25 million groundwater wells distributed all over in the nook and corner [in India], any policy recommendation should have low transaction cost of implementation. If the transaction cost exceeds the tax revenue from pricing water or electricity, it is an unviable policy.

Carrots work more effectively in India than sticks. In addition, incentives for those who adopt or who eat carrots and no incentives (not disincentives) for those who do not eat carrots, will also work. However, sticks don't since transaction cost of administering sticks is heavy and goes negative. Capacity building, awareness, incentives for those who adopt, linking benefits from developmental programs with those who have adopted efficiency measures, will and can work, but not sticks. This is my stand. It is left to you to reject. I do not insist that you should agree to this.
I agree that it's difficult to make sticks work, but I'm more skeptical about the effectiveness of carrots that are designed or applied by outsiders. Instead, I'd leave groundwater management to locals sharing an aquifer, so they can find their own governance model. The stick is their failed future, should they not control use.

3 comments:

  1. If the carrot or the stick really applies more to their children or grandchildren, how to you make the incentive effective?
    People put things off as long as they can.

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  2. You said "Instead, I'd leave groundwater management to locals sharing an aquifer, so they can find their own governance model. The stick is their failed future, should they not control use." If you can visit Kolar district, in India, you will find that farmers to some extent have born the brunt of high probability of well failure, and have shifted to adopting drip irrigation. Nowhere in the world, perhaps including Israel, you can find farmers adopting drop irrigation for narrow spaced crops like green leafy vegetables, tomato, flowers and other crops. However, the supply side is still untouched, since farmers are feeling that their borewells are as deep as 1000 feet or beyond and this makes it difficult for borewell recharge efforts on the farm.

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  3. Eric -- you're right, which is why I'm a fan of feedback, e.g., updated readings of g/w depth (via water level in wells), so that EVERYONE can see what's happening. People will act on decay, when they are reminded of it. The "change oil" light in your car invites short term pain ($ and time) to prevent long run $$$ damage. Some people ignore the light, but most don't.

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