|Author:||Bourgeon, J. M. ; Easter, K. W. ; Smith, R. B. W.|
|Book Group Author:||NA|
We examine potential third-party effects arising from trading water from one region (rural) to another (urban). Using labor, water and heterogeneous land, rural agents produce a traded agricultural good and nontraded service good. Absent job market frictions, increased water trading improves per capita regional welfare, but aggregate service income can increase (decrease) while individual land rents decrease (increase). If labour experiences job market frictions, water trading can trigger socially inefficient land fallowing, and a decrease in per capita regional welfare. Simulation results confirm the no-job-market-friction model predictions.
|Pages:||902 - 917|
|Journal:||American Journal of Agricultural Economics|
agricultural production, income, labour market, markets,rural areas, simulation models, urban areas, water allocation, welfareeconomics, labor market, Agricultural Economics (EE110), NaturalResource Economics (EE115) (New March 2000), Labour and Employment(EE900), Income and Poverty (EE950), Water Resources (PP200)