Iran-Water Resources Research

Iran-Water Resources Research

Estimating the Water Supply Function in Secondary and Productivity Markets, Case Study: Qazvin Water Share Market

Document Type : Original Article

Authors
Seyedeh Marziye Hosseini 1
Hamed Mazandarani Zadeh 2
Hamid Azizmohammadlou 3
Mohammad Mahjoub 4
1 Ph.D. Student, Water Science and Engineering Department, Imam Khomeini International University, Qazvin, Iran
2 Associate Professor, Water Science and Engineering Department, Imam Khomeini International University, Qazvin, Iran.
3 Associate Professor, Accounting Department, Imam Khomeini International University, Qazvin, Iran.
4 Ph.D. in Chemistry, Executive Director of Qazvin Province Water Rights Market Project, Qazvin, Iran.
10.22034/iwrr.2025.500992.2823
Abstract
The increase in population, the occurrence of droughts and the uncontrolled extraction of groundwater resources have limited water resources. One of the new topics in water resource management is the formation of water markets, which is used as a tool for water resources reallocating. In order to increase productivity and manage water resources, the water rights market in Qazvin province has been piloted since March, 2023. The aim of this study is to examine the water supply mechanism in the water right market and estimate the supply function in secondary and productivity markets. The secondary market is a market in which suppliers and applicants are both from the agricultural sector and the productivity market is a market where suppliers are from the agricultural sector and applicants from the industrial sector. To estimate the supply function, the principles of microeconomics and the Ordinary least squares regression method have been used. The supply function was estimated using data from July 2023 to December 2024 on the volume and selling price of water traded in the market, production costs, well depth, operating hours, technologies used including pump type and irrigation system type, annual water right amount and cultivation area. The price coefficient in the productivity market was estimated at 0.277 and 2.046 in the secondary market. The negative price elasticity of supply in the secondary market indicates that risks exist for farmers to enter the secondary market, and this risk can cause unwillingness of farmers to enter.
 
Keywords
Water Resources Management, Market Mechanism, Groundwater, Agriculture

Subjects

Ahmadi A, Zolfagharipoor M, Nikouei A, Dorreali M (2016) Economic assessment of technical infrastructure implementation of an agricultural water market, A Case Study: Part of the Mahyar Irrigation Network. Iran-Water Resources Research 12(3): 35-49 (In Persian)
Badi Barzin H, Khamri E, Fari Moghadam Z, Parhizkari A (2018) The effects of regional water markets formation on balancing the supply and demand of irrigation water in the Sistan Region. Iran-Water Resources Research 14(3):253-256 (In Persian)
Bohlolvand A, Sadr S K, Hashemi A (2014) The role of agricultural water markets in the allocation and pricing of water resources (Case study: Mojen Water market). Iranian Journal of Agricultural Economics and Development Research 45(4):761-773 (In Persian)
Chin W W (1998) Commentary: Issues and opinion on structural equation modeling. MIS quarterly, vii-xvi.
Esmaelnia Balagatabi F, Sarlak A, Ghaffari H (2018) Investigating the economic and welfare effects of the water market: A positive mathematical programming model approach. Economic Modelling 12(42):119-136 (In Persian)
Hanouz M D, Collins A, Marti G, Browne C, Di Battista A, Shaw K, Verin S (2017) The global risks report 2017. In The World Economic Forum: Geneva, Switzerland (pp. 91-93)
Hasanshahi M (2012) Estimation of the economic supply function of water in the agricultural sector A case study of Arsanjan-Fars city. Journal of English Studies 2(3):81-94 (In Persian)
Hashemi M, Mazandarani zadeh H, Daneshkare Arasteh P, Zarghami M (2020) Evaluation of management policies to simultaneously maintain groundwater resources and farmers' livelihoods Using the System dynamics and Game Theory. Iran-Water Resources Research 16(3):1-17 (In Persian)
Heydarzadeh H, Mirghasemi S H, Barqamadi M (2024) Analytical note: Experimental implementation of the water market in the study area of Khaf, Razavi Khorasan province. Journal of Water and Sustainable Development 11(2):118-119 (In Persian)
Howitt R, Medellín-Azuara J, MacEwan D, Lund J R, Sumner D (2015) Economic analysis of the 2014 drought for California agriculture (p. 16). University of California, Davis, CA: Center for Watershed Sciences.
Moghaddam N, Kholghi M (2025) Simultaneous assessment of groundwater level changes and salinity (Case study: Qazvin Plain). Professional Promoting Scientific Journal of Aquifer 16(1) (In Persian)
Mazandarani Zadeh H, Hoseini M (2023) Investigating the effect of agricultural product price forecasting on groundwater level using systems dynamics, in order to simultaneously maintain the welfare of farmers and groundwater resources. Iranian Journal of Soil and Water Research 53(11):2565-2582 (In Persian)
Mohseni S, Zare Mehrjerdi M R, Abdollahi M,  Mehrabii Boshr Abadi H (2023) Agricultural water pricing under conditions of uncertainty (Case study: Rafsanjan-Anar plain). Irrigation and Water Engineering 13(4):329-346 (In Persian)
Naderi S, Moridi A (2024) Assessing the sustainability of water and agriculture security by analyzing the decoupling of agriculture economics from groundwater withdrawal. Water and Irrigation Management 14(3):543-565 (In Persian)
Nourani L, Mousavi N, Shirvanian A (2022) Economic impact assessment of agricultural water market formation in irrigation network of Ramjerd Plain in Iran. Agricultural Economics and Development 29(4):177-204 (In Persian)
Parhizkari A, Yavari Q, Mahmoodi A, Bakhshi Khaniki Q (2022) Evaluation of the potential effects of establishing a local water market in the face of drought and water shortage in Tehran Province. Iran-Water Resources Research 17(4):192-210 (In Persian)
Sapino F, Pérez-Blanco C D, Gutiérrez-Martín C, Frontuto V (2020) An ensemble experiment of mathematical programming models to assess socio-economic effects of agricultural water pricing reform in the Piedmont Region, Italy. Journal of Environmental Management 267:110645
Shabani Rouchi Z, Yazdani S, Moghaddasi R (2022) Feasibility study of water market design with conditional evaluation approach (Case Study: Hashtgerd Plain, Alborz Province). Iranian Journal of Soil and Water Research 53(1):159-169 (In Persian)
Shabani rouchi Z, Yazdani S, Moghaddasi R (2024) Estimating the Amount of saving in water consumption under the condition of forming a water market and examining its welfare effects: A case study of Hashtgerd Plain in Alborz Province of Iran. Agricultural Economics and Development 31(4):73-101 (In Persian)
Shirzadi Laskookalayeh S, Ghaderi Nejad P, Nematolahi Z (2022) The effect of water pricing on water consumption of Iranian crops. Agricultural Economics 16(2):1-25 (In Persian)
Yazdani V, Mansourian H (2019) The assessment vulnerability of Qazvin-plain aquifer, sensitivity
analysis removing parameters by using GIS. Irrigation and Water Engineering 10(2):127-145 (In Persian)
Zarei Ghorkhodi A, Shahnazari A (2024) Evaluating the impact of creating a water market on improving productivity using a mathematical programming model (Case study: Tajen watershed). Water and Irrigation Management 14(1):207-221 (In Persian)
Zeng X T, Li Y P, Huang G H, Liu J (2016) Modeling water trading under uncertainty for supporting water resources management in an arid region. Journal of Water Resources Planning and Management 142(2):04015058
 

  • Receive Date 20 January 2025
  • Revise Date 15 March 2025
  • Accept Date 03 May 2025