Water market simulation based on the principles of sustainable development (Case study: Hashtgerd plain, Alborz Province, Iran)

Document Type : Research Paper


1 Department of Economics, Propagation and Agricultural Education, Science and Research Branch, Islamic Azad University, Tehran

2 Department of Agricultural Economics, College of Agriculture and Natural Resources, University of Tehran, Karaj, Iran



The decrease in groundwater levels and the subsequent land subsidence of over 20 cm have now become one of the major environmental concerns in the plains of Alborz Province. On the other hand, over-extraction of groundwater resources in this province will cause a great catastrophe in the near future. To prevent this consequence, the installation of volumetric meters is one of the solutions in the province. Therefore, launching a water market is one of the best strategies that can be considered in this situation. This study was carried out in the Hashtgerd plain as the most important agricultural area of ​​ Alborz Province, which consumes 87% and 90% of surface water and groundwater resources in agriculture, to investigate the effects of water market simulation. So, a positive mathematical planning (PMP) model was estimated with the regional functions of Statewide Agricultural Production (SWAP) approach. A demand function was extracted using the information collected in the form of a questionnaire and through the relevant organizations. Accordingly, the equilibrium price of water is 3,394 Rials m-3 in the Hashtgerd plain, which will save over 26% in water consumption. The implementation of this policy, is dis-advantageous for water buyers while advantageous (beneficial) for water sellers. Therefore, there will be less reduction in the resulting benefit by implementing this policy, such as increasing the efficiency of irrigation systems, at the same time as launching a water market.


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