Water Subsidies: Reply to letters from Long, Kittel, Mills, and Martin

Keywords

Irrigation water, Income taxes, Economic development, Irrigated farming, Water consumption, Agricultural subsidies, Irrigation, Agricultural resources

Abstract

We welcome this opportunity to respond to Roger Long's critique of our CHOICES article on federal water subsidies. In the West, one often hears the views that Long espouses, but generally not from professional economists. They are usually advanced by defenders of subsidized federal water development, including politicians from the region. Long's principal criticism is that we "completely" neglected the benefit side of subsidized irrigation water development. We plead not guilty to this charge. We agree that a legitimate question can be asked about how benefits are adequately measured or calculated. Where competitive markets exist, the price of any input should be a reflection of its value of the marginal product. It is true that the average value product may be higher if economic renters are earned on all the supramarginal quantities. The discrepancy between average and marginal products will depend on the elasticity of the demand curve for the input. But this point is no the substance of Long's criticism as will be clear later.

Original Publication Citation

Water Subsidies: Reply to letters from Long, Kittel, Mills, and Martin. Choices, First Quarter, 1989, pp. 40-41.

Document Type

Peer-Reviewed Article

Publication Date

1989

Permanent URL

http://hdl.lib.byu.edu/1877/5481

Publisher

Agriculture and Applied Economics Association

Language

English

College

Family, Home, and Social Sciences

Department

Economics

University Standing at Time of Publication

Full Professor

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