Abstract
For efficient use of water as a limited resource, evaluation on the water value is critical, but there is little information in Asian paddy irrigation. This paper proposes the method for measuring implicit price of paddy irrigation water by using the choice experiment (CE) data with contingent scenarios. Empirical results demonstrated that (a) the estimated implicit price of water showed reasonable value as compared to the production indexes, (b) the random parameter multinomial logit model was more suitable than the conventional multinomial logit model to treat the CE data, and (c) the implicit price is much lower than the full cost price, indicating that full cost pricing probably damages and ruins rice production too seriously in Japan. As seen above, the method proposed here is useful for decision making on water pricing policies and easy to apply to different irrigation systems under limited data of water value.
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Notes
Estimations of the binomial logit model also show that no characteristic of individual farmers had effects as explanatory variables to separate opt-out case from others (Fitzgerald et al. 1998).
The price elasticity of water was calculated by (liner function) \( \eta_{\text{W}} = \frac{\partial W/W}{\partial R/R} = \frac{{\beta_{5} + \beta_{6} \bar{A}}}{{\beta_{1} }}\frac{{\bar{R}}}{{\bar{W}}} \), and (log-linear function) \( \eta_{\text{W}} = \frac{{\beta_{5} + \beta_{6} \ln (\bar{A})}}{{\beta_{1} }} \).
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Acknowledgments
The author obtained many useful comments on an earlier draft of the paper at the 5th International Conference of Asian Society of Agricultural Economics and Agricultural Engineering World Congress 2006. Also this paper was checked by Dr. DeMar Taylor (University of Tsukuba) and International Science Editing Co. Ltd. These comments and contributions are gratefully acknowledged. The author is responsible for any errors.
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Kunimitsu, Y. Measuring the implicit value of paddy irrigation water: application of RPML model to the contingent choice experiment data in Japan. Paddy Water Environ 7, 177–185 (2009). https://doi.org/10.1007/s10333-009-0159-9
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DOI: https://doi.org/10.1007/s10333-009-0159-9