Iran-Water Resources Research

Iran-Water Resources Research

Examining the Impacts of Water Market Establishment on Groundwater Resources and Economy in the Absence of Sufficient Management Rules and Monitoring: A Case Study of Hashtgerd Plain

Document Type : Original Article

Authors
1 Ph.D. Student, Department of Irrigation and Reclamation Engineering, College of Agriculture and Natural Resources, University of Tehran, Karaj, Iran.
2 Professor, Department of Irrigation and Reclamation Engineering, College of Agriculture and Natural Resources, University of Tehran, Karaj, Iran.
3 Associate Professor, Department of Irrigation and Reclamation Engineering, College of Agriculture and Natural Resources, University of Tehran, Karaj, Iran. 5- Professor, School of Civil Engineering, College of Engineering, University of Tehran, Tehran, Iran.
4 Professor, School of Civil Engineering, College of Engineering, University of Tehran, Tehran, Iran.
5 Associate Professor, Department of Irrigation and Reclamation Engineering, College of Agriculture and Natural Resources, University of Tehran, Karaj, Iran.
Abstract
This research investigates the significance of accurate water sales programs and the role of executive and supervisory bodies in the success of water markets in achieving their objectives. With the aim of evaluating the effects of establishing a water market in the Hashtgerd plain, under conditions of non-conformity between water exchange programs and regional circumstances, coupled with weaknesses in program updates and inadequate management and supervision 20 years after its launch, a Multi Objective Decision Making model (MODM) (focusing on reducing groundwater extraction and increasing economic profit) was developed in GAMS software and solved using the Augmented epsilon-constraint (AEC) method. The results indicated that in the absence of sufficient supervision and management, the water market leads to the development of certain industrial and agricultural activities (greenhouses and orchards) with higher profitability and lower water consumption. This, in turn, disrupts the balance of production in the region. Despite a significant increase in the region’s economic profitability (from 53.8 billion to 3,777 billion annually), the annual water withdrawal from groundwater resources increases from 227 to 288 million cubic meters. This is because market participants, motivated by greater profit, are disinclined to reduce their water usage. This study emphasizes the critical importance of active supervision and management in water markets. Failure to update water sales programs in line with upstream policies and the absence of necessary restrictions can lead to irreparable damage to water resources and exacerbate social conflicts. To ensure the success of the water market and the sustainability of water resources, recommendations are proposed, including the development of regional planning models, modernization of control equipment, continuous monitoring of market impacts, and the revision of regulations pertaining to existing villa-orchards in the region.
Keywords

Subjects


Bajaj A, Singh S P, and Nayak D (2023) Are farmers willing to pay for groundwater irrigation? Insights from informal groundwater markets in Western Uttar Pradesh, India. Journal of Agricultural Water Management 288:108458
Deb K (2014) Multi-objective optimization in Search methodologies. Springer, 403-449p
Gunantara N (2018) A review of multi-objective optimization: Methods and its applications. Journal of Cogent Engineering 5(1):1502242
Du E, Cai X, Wu F, Foster T, and Zheng Ch (2021) Exploring the impacts of the inequality of water permit allocation and farmers’ behaviors on the performance of an agricultural water market. Journal of Hydrology 599:126303
Ghaffari Moghadam Z, Moradi EHashemi Tabar M, and Sardar Shahraki A (2022) Optimal allocation of water resources in the agricultural sector by using the Stackelberg-Nash-Cournot Model and emphasis on water market (Case Study: Sistan Plain Pipe Water Transfer Project). Iranian Journal of Eco Hydrology 9(1):273-289 (In Persian)
Mavrotas G (2009) Effective implementation of the ε-constraint method in multi-objective mathematical programming problems. Journal of Applied mathematics and computation 213(2):455-465
Montilla López N M, Gómez-Limón J A, and Gutiérrez-Martín C (2018) Simulating farmers’ decision-making with a Cobb-Douglass MAUF: An application for an Ex-Ante policy analysis of water pricing. Multicriteria Analysis in Agriculture, 199-221p
Nourani L, Mousavi N, and Shirvanian A (2022) Economic impact assessment of agricultural water market formation in irrigation network of Ramjerd Plain in Iran. Iranian Journal of Agricultural Economics and Development 29(4):177-204 (In Persian)
Parhizkari A, Yavari G, Mahmoodi A, and Bakhshi khaniki G (2024) Establishment of a structural institution of the local water market in the irrigation network of Tehran Province with statewide agricultural production model approach. Iranian Journal of Agricultural Economics Research 15(4):28-51 (In Persian)
Rabbanimehr M, Sanayie A, and Kazemi A (2021) Investigating the factors that affect consumer behavior in social capital management and facilitates the implementation of water local markets. Iranian Journal of Busines Administration Researches 31(25):111-131 (In Persian)
Razavi Al-e-hashem S A, Papi A, Pishvaee M S, and Rasouli M (2022) Robust maintenance planning and scheduling for multi-factory production networks considering disruption cost: A bi-objective optimization model and a metaheuristic solution method. Journal of Operational Research 22(5):4999-5034
Ruth M D (2014) Property rights and sustainable irrigation: A developing country perspective. Journal of Agricultural Water Management 145:23-31
Samareh Hashemi Kh, Keikha A, Boshraabadi H M, Mardani Najafabadi M, and Ziaee S (2021) Evaluation of water market performance and its comparison with different allocation rules of water in drought conditions. Iranian Journal of Agricultural Economics and Development 29(2):29-53 (In Persian)
Shabani rouchi Z, Yazdani S, and 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. Iranian Journal of Agricultural Economics and Development 31(4):73-101 (In Persian)
Sheng J, Cheng Q, and Yang H (2024) Water markets and water inequality: China's water rights trading pilot. Journal of Socio-Economic Planning Sciences  94:101929
Tian Y, Si L, Zhang X, and Cheng R (2021) Evolutionary large-scale multi-objective optimization: A survey. Journal of ACM Computing Surveys (CSUR) 54(8):1-34
Vahedi Zade S, Forouhar L, and Kerachian R (2019) Comparative study of international water markets. Iran-Water Resources Research 14(4):194-205 (In Persian)  
Wheeler S A, Loch A, Crase L, Young M, and Grafton R Q (2017) Developing a water market readiness assessment framework. Journal of Hydrology 552:807-820
Wight C, Garmany K, Arima E, and Garrick D (2024) Texas water markets: Understanding their trends, drivers, and future potential. Journal of Ecological Economics 224:108259
Zarei ghorkhodi A and Shahnazar A (2024) Evaluating the impact of creating a water market on improving productivity using a mathematical programming model (Case study: Tajen Watershed). Iranian Journal of Water and Irrigation Management 14(1):207-221 (In Persian)
Zhao J, Cai X, and Wang Z (2013) Comparing administered and market-based water allocation systems through a consistent agent-based modeling framework. Journal of Environmental Management 123:120-130 
Zhoa M and Ancev T (2025) Water governance and water markets. Encyclopedia of Energy, Natural Resource, and Environmental Economics (Second Edition) 2:269-277

  • Receive Date 11 May 2025
  • Revise Date 11 July 2025
  • Accept Date 30 August 2025