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| Title
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Water Management in the Moral Hazard Trap
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| Subtitle
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The Example of Irrigation
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| Author
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Huppert, W.
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| Editor or Organisation
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GIZ
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| Year
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2006
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| Keywords
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irrigation management, water delivery, water sector, reform, principal-agent problems, moral hazard, institutions
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| Country
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India
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| Type
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publication
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| Language
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English
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| Table of Contents
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1. Introduction
2. The nature of Principal-Agent problems
3. “Moral Hazard“ situations
4. Identifying Moral Hazard situations in irrigation practice
5. Coping with Moral Hazard problems in irrigation
Solving Moral Hazard problems in water service delivery
7. Conclusion
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| Abstract
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In a world of growing water scarcity, a key challenge consists in efficieny improvements in irrigated agriculture. Common reactions to this challenge focus on technical, financial and/or organisational improvements. While such efforts may be well justified in many cases, they often run the risk of overlooking some of the major causes for inefficiencies in the first place. These problems relate to the fact that efficieny deficits may be well in the interest of most of the influential stakeholders involved. It is here, where so-called “Principal-Agent” problems and the related “Moral Hazard”situations deserve attention, since they open doors to rentseeking and corruption. This paper, which refers to initiatives in the context of irrigation sector reforms in Andhra Pradesh, India, in the wake of the Farmers’ Management of Irrigation Systems Act (FMISA) of 1997, does not aim at reflecting the actual situation of irrigation in Andhra Pradesh.
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| Permission
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Yes
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| Category
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Enabling Environment
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| File
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