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Ecologically and Socially Embedded Exchange: 'Gujarat Model' of Water Markets

Navroz K. Dubash
Economic and Political Weekly
Vol. 35, No. 16 (Apr. 15-21, 2000), pp. 1376-1385
Stable URL: http://www.jstor.org/stable/4409175
Page Count: 10
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Ecologically and Socially Embedded Exchange: 'Gujarat Model' of Water Markets
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Abstract

Groundwater markets are highly developed in the state of Gujarat, as a result of which the Gujarat experience has been upheld as a model of how markets can enhance access to irrigation. This 'Gujarat model' rests on key assumptions about being able to shape and construct markets through policy intervention. In this paper, empirical comparative data on water markets in two villages shows instead that exchange processes are shaped by: hydro-geological factors which influence the risk of accessing water and the fixed costs of drilling wells; path dependence in the construction of irrigation infrastructure (wells and pipelines); and historical precedent and social norms which determine the institutional rules under which water is sold. But actual patterns of exchange rate shaped by complex local institutions. To understand how terms of exchange are structured and shaped over time requires attention to the micro-analytics of how real markets for groundwater actually function. Accordingly, the paper analyses local informal norms of exchange, and explores how they change over time.

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