In a randomized field experiment, researchers test whether training medium scale farmers in an agricultural water reduction practice reduces water use from common aquifers in Haryana, India. The paper ‘What works for water conservation?’ published in the Journal of Environmental Economics and Management finds that training farmers in a water reduction technique, Alternate Wetting and Drying (AWD), reduced pumping hours by 22% during peak pumping weeks without affecting their yields.
The study also incorporates the use of social comparison messages. The paper argues that farmers will adopt AWD despite flat fee tariffs if farmers own their pumps and if their crops can reach their varietal potential. This is because there are diminishing returns to irrigation and irrigation costs rise as water levels drop.
Context
In northern India, water tables are being depleted at accelerated rates, yet farmers grow water-intensive crops such as rice. Groundwater extraction from this region accounts for roughly 25% of all groundwater extraction worldwide. Several factors contribute to the observed depletion. At the individual level, there is a lack of incentives to reduce water use in rice cultivation due to heavy state subsidies.
But appropriately pricing water has had variable effects. Studies indicate that water pricing has often been an ineffective tool in managing water largely due to farmers’ inelastic demand for water, which policy makers fail to take into consideration. In India, unit pricing has not changed user behaviour, but more recently, in Bangladesh, a study shows that volumetric pricing may contribute to reduced water use when combined with training. In addition, an erratic supply of electricity can lead to hoarding of water resources, as can an increase in the number of extreme heat days coming from climate change.
Another barrier to reducing water overuse occurs at the group level. Because wells draw water from a shared aquifer, a common resource, farmers’ water use imposes a negative externality on other farmers’ water availability. Local or federal authorities could attempt to regulate use, but the large number of governance conditions that are required for successful management of common resources can be difficult to meet.
Beyond top-down schemes to control water use – such as government regulation and pricing schemes – we can aim to encourage individual farmers to use new technologies that will help them conserve water. This may seem difficult given the historically low adoption of new technologies with more immediate private returns in less developed countries. Thus, encouraging farmers to adopt new technologies that conserve resources that accrue to the commons may seem even more challenging.
However, all of the latter technologies have been typically offered to financially constrained individuals. Conversely, in our context, farmers are relatively well off and face little financial constraint in pumping water. Yet, nearly all of the farmers in our study are aware that if their pumping practices are left unchecked, they will face higher costs to increase the horsepower and depth of their pump, and that water in their region will eventually be depleted.
The study was conducted in Haryana, India, across two districts: Kurukshetra and Kaithal – two northern districts where rice and wheat are the primary crops grown, where groundwater irrigation is prominent, and where groundwater levels have been depleting.
The study
In this paper, the authors offer farmers a free and effective means to reduce their individual water use without any pecuniary incentives beyond the value of saving water. It introduces a well-known established agricultural practice called alternate wetting and drying (AWD), also known as intermittent irrigation or flooding, which reduces water use without reducing yields in a two-arm randomized controlled trial (RCT).
There are few short-term economic gains to adopting the practice as water pumping and electricity use are practically free and AWD does not, historically, increase yields. Rather, the practice appeals to the long-term sustainability that is needed if farmers are to continue growing rice in the region. The returns come from reducing the need to lower and replace pumps over time.
The researchers first discuss and inform farmers of decreasing water tables in the area, which the majority are already aware of. They then advise farmers on well-defined goals in terms of how much water to use each week given local conditions.
The challenge with conserving natural resources is the incentive to free ride on the conservation of others. In response to this type of commons problem, a vast literature has emerged that studies the use of social nudges or social comparison messages that highlight these mutual dependencies to the user and encourage the adoption of conservation practices. These behavioural interventions rely on users valuing how their behaviour compares to that of individuals similar to themselves or to the average user.
Given the success of many of the above norm based messaging studies in curtailing domestic resource use, even in the long run, the researchers introduced a sub-treatment arm in which, in addition to the AWD training, the researchers exposed farmers to social comparison messages. The messages reported a farmer’s water pumping hours in relation to the average use within his or her farmer group each week.
Note that the researchers do not estimate the effects of social comparison messaging alone, as many of the above studies have done. It was essential that the researchers provided farmers with the means and training to reduce their water use in a safe, yet effective manner.
Simply messaging farmers and asking them to reduce their water use could be detrimental to their livelihoods and food security without proper training and guidance. The objective was to test whether the package of both training and comparisons would be more effective than training alone.
Estimating the effect across the weeks that AWD was recommended, the researchers find that the overall effect of AWD training exhibits a reduction of 2.2 pumping hours per acre per week in the first three peak weeks of the season, where total pumping hours per acre range from two to 10 h per week—resulting in a 22% decline.
With the second treatment arm, the study finds suggestive evidence that the social comparison messaging did not improve the effects of AWD alone. The authors draw on Wang and Segarra (2011) to argue that these results are consistent with a forward looking farmer who is using enough water to begin with to reach the crop’s varietal potential. This is because past a certain point, yield stops responding to additional water, and since AWD increases the marginal product of water, a crop’s satiation point can be reached with less water.
If farmers consider future costs, then adopting AWD will lower their future marginal pumping cost since farmers will not have to pump from deeper wells. These two features differentiate our context from both domestic use consumption, and agricultural contexts where farmers pay a flat fee but do not own their pumps or wells.
The magnitude of the findings is in line with other existing economic studies that have aimed to reduce water use such as a 24% decline in groundwater extraction from an RCT promoting laser-levelling (Lybbert et al., 2018); a 30% decline in pumping hours from a study estimating the impacts of a compensation scheme for unused electricity in Punjab, India (Mitra et al., 2022); and a 31% decline in standing water levels from an RCT of AWD in districts with volumetric pricing in Bangladesh.
The study contributes to the latter literature because it demonstrates, within a randomized framework, that similar levels of water reduction can be attained as in other studies, but using a low-cost technique in contrast to land laser levelling—and, importantly, under a flat fee structure for electricity, as opposed to unit pricing or a payback compensation scheme, as long as the farmer owns the pump.
Thus, the authors argue that even without volumetric pricing a forward looking farmer who owns a pump will not want to irrigate past a certain satiation point, since yields are no longer increasing and additional pumping shortens the usable life of a pump and aquifer.
Conclusions
Many studies in the development literature focus on introducing ostensibly profitable agronomic techniques and technologies to some of the poorest farmers in developing countries. Less has been studied with regards to the adoption of agronomic technologies that do not offer immediate private returns, but that save resources for the community over the long term. Studying the behaviour of higher resource consuming populations is increasingly important as the demand for resources like water continues to rise.
The study provides unique evidence on a non-price intervention that can improve water conservation for medium sized farmers in the agricultural developing country context. Using a randomized field experiment, the researchers find that sensitising farmers to the long-term consequences of depleting their common water aquifers and providing training and continued guidance in a water-saving technology called alternate wetting and drying (AWD) resulted in a statistically and economically significant reduction in water use (22% decrease).
The evidence in the study is inconclusive on the value of social comparison messages to our training treatment in this agricultural context, where social comparison messages have been effective at curtailing common resource use, particularly in domestic contexts. Overall, the study finds that AWD training alone has an impact on reducing water use.
It argues that this is due to the yield–water relationship of crops, in which, past a threshold, additional water does not result in increased yields, but lowers water tables and shortens the lifespan of a pump, which affects long term costs for the pump owner—in this case the farmer. Adopting AWD increases the marginal productivity of water allowing farmers to reach a crop’s satiation point with less water, and also reduces the future marginal cost of abstraction.
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