The Role of Water Market Formation in Using the Water Resources in Agricultural Sector: A Case Study of Mashhad Plain in Iran

Water market as a significant economic means plays an important role in the optimal allocation of water resources in agriculture and also has significant effects in determining the cropping pattern and improving the welfare of farmers. With this approach, this study aimed at investigating the role of the water market on the use of water resources in Mashhad plain of Iran (Mashhad, Chenaran, and Torghabeh-Shandiz Counties) in farming year of 2013-14. For this purpose, the model of positive mathematical programming (PMP) and functions of regional production of agricultural products (SWAP) were used. The data were collected by Morgan sampling and Krejcie from 350 questionnaires completed randomly with farmers by referring to the organizations concerned. The results showed that following the formation of water market in the region, cropping patterns were directed towards products with higher profitability; also, substantial water-saving was achieved in the region, so that after the formation of the water market, water consumption decreased in the above-mentioned Counties by 37, 23.85 and 29.09 percent, respectively, indicating the usefulness of the formation of water market in order to reduce the use of water resources in the region.