MODELING THE ECONOMIC EFFICIENCY OF IRRIGATION WATER SUPPLY IN DRY AND HUMID REGIONS

This paper tests the economic efficiency of irrigation water as supplied by single purpose and by general purpose public utilities in dry and humid regions, respectively, in terms of underprovision and overprovision. The proposed methodology mixes conceptual frameworks developed by Farrell (1957) and Brueckner (1979, 1982) . A typical agricultural production function uses the institutional attributes of the water-providing authority as an argument. Both short-run and long-run estimates are provided. Although in both cases irrigation water is heavily subsidized, there is no evidence of systematic underprovision or overprovision for the dry north and west, under the single purpose Irrigation Authority. However, water is oversupplied to more humid areas by the general purpose Central Water Authority. Empirical estimates confirm that the efficiency of the single purpose Irrigation Authority cannot be attributed to irrigation technique. The general purpose Water Authority suffers from inefficiency in coordinating rainwater availability with the institutional water supply.