The willingness to pay for irrigation water: a case study in northwest China

To inform the further development of water pricing in Shiyang River basin, a typical arid region in
northwest China with agriculture as the major consumer of water, this research conducted a
contingent valuation study on farmer’s willingness to pay (WTP) for irrigation water. The results show
that the current irrigation water price is to low to achieve sustainable use of water. The main reason of
low price is not the farmer’s inability to pay, but their unwillingness to pay. Furthermore, a vicious
cycle of less willingness to pay and poor services exist in irrigation water management. The probable
solutions include the increase of public investment in water infrastructure and determine appropriate
price between surface water and groundwater. More important, enhance the communication and
cooperation between water use and water agency, the combination of price mechanism and other
instruments, such as positive incentives and the establishment of an independent water user
organization (WUO), are useful.