Equity-Efficiency Optimizing Resource Allocation: The Role of Time Preferences in a Repeated Irrigation Game

Bjorn Van Campenhout*, Ben D'Exelle*, Els Lecoutere*

*Corresponding author for this work

Research output: Contribution to journalArticleAcademicpeer-review

5 Citations (Scopus)

Abstract

We study repeated water allocation decisions among small scale irrigation users in Tanzania. In a treatment replicating water scarcity conditions, convexities in production make that substantial efficiency gains can be obtained by deviating from equal sharing, leading to an equity-efficiency trade-off. In a repeated game setting, it becomes possible to reconcile efficiency with equity by rotating the person who receives the largest share, but such a strategy requires a longer run perspective. Correlating experimental data from an irrigation game with individual time preference data, we find that less patient irrigators are less likely to use a rotation strategy.

Original languageEnglish
Pages (from-to)234-253
Number of pages20
JournalOxford Bulletin of Economics and Statistics
Volume77
Issue number2
DOIs
Publication statusPublished - Apr 2015
Externally publishedYes

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