The Impact of Water Tariffs in the Agricultural Sector on Resource Efficiency and Sustainability: From Theory to Practice

Water pricing is recognized as an effective tool in reducing demand and achieving the goals of productivity, sustainability and improving the costs of water resources management. Here the positive mathematical programming method has been used by evaluating the various effects of water pricing, with an emphasis on Urmia Lake basin. Acknowledging the complex social, economic and political dimensions of water tariffs and the challenges in policy implementation, the water pricing policy in conjunction with irrigation system modifications for water consumption efficiency and resource sustainability has been analyzed by analyzing the mechanisms governing the system and feedback relationships. Any constructive change must be determined and implemented by affecting the loops constituting the system behavior. The findings indicate the significant impact of water subsidies on agricultural profits and the obligation to increase water tariffs, with paying attention to the rebound effect and water crisis. While increasing irrigation efficiency is among the selected scenarios of the mathematical modeling, it can trigger the behavioral pattern of fixes that fail and, the limit to growth pattern, contribute to the worsening of water scarcity. The results provide insight to avoid reliance on short-term solutions and promotes deeper understanding of the resource sustainability. To avoid the tensions of abrupt increases in water tariffs, the selection of appropriate strategies mentioned in this study, along with a gradual increase in water prices, should be implemented to balance the benefits and costs of this policy to move towards social and economic efficiency and water resource sustainability in the region.