Strategic Policy Options to Improve Irrigation Water Allocation Efficiency: Analysis on Egypt and Morocco

For a number of reasons government the world over have been unwilling to use water pricing to achieve water use efficiency. This research addresses questions of what policy alternatives to water pricing might improve irrigation water allocation efficiency. An empirical framework is provided to compare irrigation policies for allocating scarce water to agricultural production in Egypt and Morocco. Partial equilibrium agricultural sector models specific to Egypt and Morocco were employed for policy tests. Positive Mathematical Programming (PMP) was used to calibrate the models. Water pricing policy, water complementary input factor tax policy, and output tax policy are tested. Results suggest that effective policy depends on the social, economic, and environmental contexts of specific regions. The results for both countries demonstrate that some of the alternative irrigation policies can work towards directing cropping decisions to less water intensive crops and also generating revenues for governments in situations where governments choose not to price water