title: Review of water pricing theories and related models
creator: Ghazali Mohayidin , 
creator: Jalal Attari, 
creator: Ahmad, Sagheri
creator: Md Arrif Hussein, 
subject: HB Economic Theory
description: Water  is vital  for  life and plays  an essential  role  for economic development of countries. To address   water  scarcity  issues,  better  pricing  has  been  recognized  as  an  important  tool.  In  this  paper  several   empirical studies which highlight water pricing theories and related models have been reviewed. These   theories  explain different  aspect of water pricing  that  can be used  as  a means  to  improve water use   efficiency. Analysis of partial equilibrium can be viewed as effects of a policy on a specific sector  like   agriculture, but an analysis of general equilibrium often  involves steady-state paths which  is  in  fact a   macro-level approach. A comparison of  first best pricing with second best pricing models shows  that   the  latter are possible when transaction costs are  included.  In the absence of storage capacities  limits   and direct costs of water, development decision studies find that the price of water held in storage must   rise  at  the  rate  of  interest  and  that  the  effect  of  discounting  is  to  cause  a  cycle  in  the water  price.   Finally, recent evidence suggests that the short-run efficiency of marginal cost pricing can be extended   to account for long-run fixed cost considerations. (Authors' abstract)
publisher: Academic Journals
date: 2009-12
type: Article
type: PeerReviewed
format: text
identifier: https://library.oum.edu.my/repository/364/1/Mohayidin_et_al%5B1%5D.pdf
identifier:   Ghazali Mohayidin ,  and Jalal Attari,  and Ahmad, Sagheri and Md Arrif Hussein,   (2009) Review of water pricing theories and related models.  African Journal of Agricultural Research, 4 (13).  pp. 1536-1544.  ISSN 1991-637X     
relation: https://library.oum.edu.my/repository/364/