Section Days abstract book 2010.indd - RUB Research School ...

HSS_01
WATER PRICING AND EXTERNALITIES
Farah Asna Ashari
IDS (International Development Studies), Institute of Development Research and
Development Policy, Ruhr-Universität Bochum, 44780 Bochum, Germany
e-mail: farahesnaashari@yahoo.com
In a sustainable value in use, the full cost of goods and services should be taken into account.
The full cost of water is composed of 5 items
Operational and management cost, and capital charges which are covered by private cost.
Opportunity cost, economic and environmental externalities which are some parts of social cost
of water.
The main idea of my research is to study the distance between private and social cost of water
supply in agriculture, emphasizing on the economic and environmental externalities. The main
feature of external effects, and the main difficulty for evaluating them, is that there is no market.
To reach to this goal,
• The externalities of agriculture water consumption should be defined.
• The best technique for estimating the externalities among different available techniques is
chosen. The choice depends on the time, financial resources, social and cultural setting
within the area etc.
• Then the cost of externalities is estimated.