Agricultural Water Management 287 (2023) 108443

Contents lists available at ScienceDirect

Agricultural Water Management

journal homepage: www.elsevier.com/locate/agwat

Improving equity in demand-driven irrigation systems through a

rights-preserving water allocation mechanism☆
Wasim Hassan a, b, *, Talha Manzoor a, Abubakr Muhammad a, b
a
Center for Water Informatics & Technology (WIT), Lahore University of Management Sciences (LUMS), Pakistan
b
Department of Electrical Engineering, Lahore University of Management Sciences (LUMS), Lahore, Pakistan

A R T I C L E I N F O A B S T R A C T

Handling Editor - Dr Z Xiying Allocation mechanisms for irrigation water distribution are largely categorized into demand and supply based
methods. Traditional supply-based mechanisms are built on the notion of equitable distribution, where the water
Keywords: rights of each farmer determine their entitlement of irrigation water. However, many studies show that these
Water allocation mechanism mechanisms often result in inefficient utilization and wastage of surface water. On the other-hand, the devel­
Equity
opment of smart, ICT driven technologies have ushered-in the age of demand based delivery, which ensures an
Water rights
optimal utilization of water, based on some selected objective. These allocation schemes, while rapidly being
adopted in a multitude of irrigation systems worldwide have been shown to result in inequitable water distri­
bution, and special measures need to be taken to protect vulnerable farmers in the system. In this paper, we
present a demand-driven allocation scheme that incorporates an initial entitlement for each farmer to ensure
equitable water allocation. The allocation mechanism has two stages: first, initial allocation of surface water
based on individual water rights; second, a demand-based distribution coupled with an auction-based pricing
mechanism. The initial allocation from the first stage may be adjusted in the second stage if the corresponding
farmers do not require water at that point in time. After the mathematical formulation of the allocation scheme,
we simulate its implementation for a selected irrigation district in the central Punjab region of Pakistan. Results
from exhaustive numerical simulations show that the proposed mechanism improves performance with respect to
socio-hydrological metrics such as equity, reliabili‘ty, compliance and consistency. Due to the demand-based
reallocation stage of the proposed mechanism, this increase in performance does not come at the cost of
degraded utilization of irrigation water as compared to a purely demand-based allocation scheme.

1. Introduction mechanism to allocate surface irrigation water that not only promotes
equity but also does so in a manner that does not compromise the uti­
Water scarcity is increasing worldwide due to climate change, pop­ lization of irrigation water.
ulation growth, and growing economic activities Rey et al. (2019). Historically, large-scale irrigation systems were developed predom­
Approximately 72% of the global freshwater is used in the agriculture inantly as supply-based ones, with water allocation done through some
sector, of which irrigation water is a major component UN (2021). Water socially accepted notion of water rights. Many of these supply-based
scarcity issues are compounded in agricultural systems due to transport systems are still active today in various regions around the world, e.g.,
losses, low profit margins, and an increasing deficit between supply and Pakistan, Mexico, Chile, and Australia (Delorit et al., 2019; Gleick, 2003.
demand of irrigation water. Alleviating the imbalance between supply In such settings, water rights systems are devised as a framework to
and demand requires an efficient water allocation mechanism. Alloca­ encompass all issues of social justice in demarcating the user base,
tion mechanisms not only determine the social distribution of water determining the share of water, and delivering the water to individual
among farmers but also have a profound impact on the conservation and users Macpherson (2019). The different water rights systems commonly
efficient utilization of water resources. In this paper, we present a practiced may be categorized into three types: Prior appropriation,

This work has been supported partially by NCRA National Agricultural Robotics Lab at LUMS. We also acknowledge the support by Center for Water Informatics
☆

and Technology (WIT), Lahore University of Management Sciences (LUMS), Lahore, Pakistan.
* Corresponding author at: Center for Water Informatics & Technology (WIT), Lahore University of Management Sciences (LUMS), Pakistan.
E-mail address: [email protected] (W. Hassan).

https://doi.org/10.1016/j.agwat.2023.108443
Received 4 October 2022; Received in revised form 3 July 2023; Accepted 4 July 2023
Available online 13 July 2023
0378-3774/© 2023 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/).
W. Hassan et al. Agricultural Water Management 287 (2023) 108443

Riparian rights, and Public rights allocation. Prior appropriation systems allocation mechanisms that use these optimization techniques fail to
consider water as a private property of the existing user base. Any new incorporate a fairness perspective in their quantitative analysis because
user will get water only after the demand of the “senior” users is fulfilled. a system-level optimal water allocation does not guarantee the best
Thus, water is distributed according to the “first in time, first in right” payoff for every user. Effective administration of an allocation mecha­
rule with priority assigned according to the time that a user was included nism needs fairness among water users De Loë and Bjornlund (2008).
in the user base Schilling (2018). In case of water scarcity, it is likely that Therefore, we present a demand-based water allocation mechanism that
the “junior” users do not get any share of water. In contrast, the riparian considers fairness and equity measures.
rights system considers water as common property, where every indi­ Irrigation networks are complex socio-hydrological networks Siva­
vidual owning land on the waterfront is entitled to a share of water. The palan et al. (2012). Consequently, the objectives of fair, equitable, and
individual share of water is usually decided on the quantity of land reliable water allocation can not be fulfilled solely through supply-based
owned on the waterfront. In case of water scarcity, users at the tail of the water rights mechanisms or demand-based schemes to meet crop water
streams may not be able to withdraw water as per their demand as users demand Xiao (2017). Thus, instead of a purely supply-based or
at the head of the stream have the advantage of withdrawing more water demand-based mechanism, we propose a scheme that blends both of
Wagner (2018). Finally, in public allocation systems, the water is un­ these techniques. The mechanism consists of two stages. In the first
derstood to be owned by the state (or any other central agent). The state stage, water is allocated to all users based on a pre-specified water rights
may allocate water rights according to any accepted notion of fairness system. Note that at this point, the water is not yet distributed. The
Wang et al. (2007). However, in such systems, the price of water often initial allocation may result in some users being allocated an amount of
misrepresents the true value of water, which may lead to misallocation water that is more than their demand, i.e., a surplus. In the next stage,
and wastage of valuable water. this combined surplus is then reallocated to those users who had a de­
In any water rights system, the allocation mechanism holds special mand higher than their initial entitlements from the first stage. Thus
significance. These mechanisms may be categorized as user-based allo­ while the first stage promotes equitable water distribution, the second
cation, public allocation, marginal-cost allocation, and water markets stage ensures increased water-use efficiency. Note that in the event of
(the interested reader may refer to (Dinar and Subramanian, 1998; the total water supply being less than the cumulative demand, some
Wang et al., 2003 for details). The categorization reflects the method to rank the users must be employed in the reallocation stage.
decision-making framework employed to determine individual water Hence, the mechanism can be viewed as a demand-driven allocation
shares and the entity that makes those decisions. In public allocation, scheme with the incorporation of an initial entitlement to reflect the
decisions on allocation are made through a centralized public entity, water rights of the users. We thus compare the performance of the
whereas in user-based allocation, the users themselves may make these proposed mechanism against a purely demand driven framework. The
decisions. User-based allocation systems usually exist in smaller regions performance is assessed using a set of metrics that compare water de­
with tightly-knit communities and are not practical for large-scale irri­ mand with water deliveries among farmers. These metrics include
gation systems. On the other hand, in marginal-cost allocation, water is measures of compliance, consistency, reliability, and equity. These
allocated indirectly by setting a price that is equal to the marginal cost of measures have previously been used to measure the performance of
supplying water. A large amount of literature exists on the study of several allocation schemes worldwide (Siddiqi et al., 2018; Molden and
appropriate water pricing schemes. However, the true valuation of Gates, 1990; Kaghazchi et al., 2021.
water is an extremely difficult problem, to say the least. Finally, water In what follows, we present a demand-based allocation scheme that
markets are decentralized frameworks with tradable water rights. These incorporates users’ initial water rights. In the first stage of the proposed
are demand-driven frameworks that overcome many of the shortcom­ mechanism, the central planner allocates water among users based on
ings that exist in supply-based systems and have been made possible by their initial water entitlement. Water is only allocated and not distrib­
recent advances in engineering, data science, and ICT technologies. uted among users at this stage. This stage of the mechanism leads toward
They are commonly portrayed as solutions for water conservation meeting policy objectives related to equity by ensuring the water rights
problems in large-scale irrigation systems Kindler (2010), Brooks of each user. However, many studies suggest that initial water entitle­
(2006), Xiao et al. (2018). Moreover, compared to conventional ments often result in inefficient utilization and wastage of surface water
supply-based systems, they do not require heavy infrastructure such as (Zardari and Cordery, 2010; Satoh, 2015; Hennessy, 2004. On the
dams and storages that have significant economic and environmental other-hand, the demand-based surface water allocation ensures optimal
impact. However, as we will discuss below, many issues of inequitable utilization of water based on some selected objectives. Therefore, a
distribution have been observed in regions where such systems have demand-based water allocation scheme is presented in the second stage.
been implemented. It is important to note that the initial allocation from the first stage is
Water markets are widely used for the demand-based management of only adjusted in the second stage if the corresponding users do not
water resources. Market-based mechanisms for water management are require water at that point in time. After adjustment of allocation in the
functional in many regions of the world, e.g., Australia, the United second stage, water is distributed among users. Thus, the first stage of
States, and Chile (AnnWheeler and Garrick, 2020; Endo et al., 2018. the mechanism is to help achieve policy objectives related to equity, and
However, some recent studies indicate that although water markets the second stage is to improve water use efficiency.
improve water-use efficiency, small farmers are at a loss economically In this paper, we demonstrate the working of the rights-preserving
and technologically Bajaj et al. (2022). Another study observes for a allocation scheme through a selected water rights system and demand-
selected water market, farmers selling water for higher payoffs and not based allocation mechanism. Note that the selected rights and alloca­
doing agriculture Edwards et al. (2008). The main objective of the tion system are merely illustrative examples, and the proposed scheme
demand-based water allocation schemes is to optimally allocate scarce should not be viewed as being limited to these examples alone. For the
water supply among competing users based on their demand. Therefore, first stage of the mechanism, we determine the initial entitlements via a
several demand-based allocation schemes also use different optimiza­ Riparian rights system prevalent in the Indus Basin Irrigation System
tion techniques to allocate water optimally. The optimization techniques (IBIS), locally known as warabandi. For the second stage, the realloca­
used to find optimal water allocation mechanisms, include dynamic tion is done via a principal-agent (central planner) in an auction-based
optimization (Dai et al., 2018; Jafarzadegan et al., 2014, non-linear market setting. The allocation is done indirectly through a Vickery-
optimization (Yang et al., 2012; Du et al., 2021, genetic algorithms Clarke-Groves (VCG)-based pricing scheme Easley and Kleinberg
(Nicklow et al., 2010; Bi et al., 2015, liner optimization (Azizifard et al., (2010). The VCG mechanism ensures that the users place their bids
2020; Kucukmehmetoglu and Guldmann, 2010, and any mixture of based on true valuations of the required water. Thus, instead of price
these optimization methods (Li et al., 2009; Yao et al., 2021. However, setting through a centralized water valuation entity, the users provide

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W. Hassan et al. Agricultural Water Management 287 (2023) 108443

each farmer against the water that they need in excess of the initial
entitlement. We determine this valuation through a second-price auc­
tion. The complet. al.ocation process is described in the following text.

2.1. Stage 1: Initial Water Rights-based Allocation

To decide about the allocation and distribution of water, first, the

central planner allocates water among farmers based on their water
entitlement. The water entitlement is represented by E(k) = [E1(k),
E2(k), . . . . , EN(k)]. While ensuring the existing water rights of each
farmer during each time interval k, the central planner must also satisfy
the following condition
∑
N
En (k) ≤ S(k), (1)
Fig. 1. An illustrative diagram representing farms connected with a typical n=1
watercourse.
where S(k) is the surface water available during the time interval k.
the valuations. Afterward, a simulated case study is presented to quan­ Next, the central planner compares each farmer’s water demand with
titatively characterize reliability and equity using data sets from real their allocated water entitlement En(k). We take dn(k) to represent the
field surveys in central Punjab, Pakistan. Exhaustive simulation results water demand for farmer n during the k-th allocation cycle. Farmers who
suggest that under some pragmatic assumptions, the proposed hybrid have water demand dn(k) less than their water entitlement, i.e., dn(k)≤
mechanism with water rights improves all the aforementioned metrics En(k), receive water equivalent to their water demand dn(k) during the
while also maintaining water-use efficiency as compared to a purely time interval k. Water more than their demand, i.e., En(k) − dn(k) is
demand driven mechanism without water rights. reallocated to farmers whose water demand is greater than their water
The text of the paper is organized as follows. The hybrid allocation entitlement, i.e., dn(k)≥ En(k) (the reallocation mechanism is defined in
model along with its mathematical formulations is presented in Section next section). Water entitlements depend upon surface water supply,
2. Next, in Section 3 we define the set of metrics to quantify compliance, and the surface water supply is variable. Since any deficit in the surface
consistency, equity, and reliability. Afterwards, in Section 4 we present water supply is proportionally divided among each farmer’s entitlement,
the case study followed by exhaustive Monte Carlo simulations to the water entitlement En(k) in the time interval k cannot be known in
compare the proposed mechanism with and without water rights. We advance. The surface water supply is variable because it depends upon
discuss the results and conclude the study in Section 5. several factors, including precipitation, water from snow melt, and
governmental water policies.
2. Water Allocation Framework
2.2. Stage 2: demand-based water reallocation
In this section, we describe the water allocation framework, using
notation and terminology that we now define. The irrigation system is In this stage, the surplus water from the previous stage is reallocated
assumed to consist of a hierarchy of waterways comprising of major among those farmers whose demand is greater than their initial enti­
canals, minor canals and watercourses.1 A demonstrative diagram of a tlement. The central planner prioritizes farmers according to their
watercourse along with the connected farms is given in Fig. 1. The major willingness to pay. The willingness to pay pn(k) is computed as follows
and minor canals supply irrigation water to the watercourses via an
intake structure. In real world systems, allocation of the water may take pn (k) = ̂
v n (k)(dn (k) − En (k)), (2)
place at multiple levels. Here, we concern ourselves with the allocation
at the lowest level in the hierarchy, which is the intake structure where ̂ v n (k) represents the valuation of farmer n for a unit of surface
(referred to in the local language as mohga). water (this valuation is reported via a bidding process discussed in the
In the assumed setting, a total of N farms are connected to the next section). Note that the factor dn(k) − En(k) represents the additional
watercourse. Each farmer n ∈ {1, …, N} irrigates her farm through the units of water required along with water entitlement En(k) during the
watercourse which receives its supply from a shared surface water time interval k. Next, the central planner arranges the competing
reservoir. The reservoir is regulated and controlled by a central au­ farmers’ bids so that farmers with the highest willingness to pay pn(k)
thority whom we refer to as the central planner. A complete cropping receive water with the first preference. Subsequently, if there is still
season consists of a total of K fixed-time intervals. The k’th interval is enough water left to reallocate, the farmer with the second-highest
((k − 1)T, kT], where k ∈ {0, 1, 2, 3, . . . . . . , K} and the fixed time willingness to pay receives water. This process continues until all the
interval T denotes the duration between successive water allocation water is reallocated among competing farmers, i.e., farmers whose water
cycles. At the start of each cycle, water is allocated to each farmer based demand dn(k) is greater than their water entitlement dn(k). Farmer pay
on the prevalent water rights system. Note that the water is not actually fixed price per cropping season for water entitlements. For example, in
distributed at this point. Next, the central planner reallocates the water the Indus Basin Irrigation System farmers have to pay around 1$ per acre
based on the individual demand for each farmer. Any farmer whose per cropping season for their water entitlement. Therefore, in our study
initial entitlement is reallocated due to low demand, receives a payment we assume that this price is negligible.
against that water. This payment is made by the farmers receiving the The vector D(k) = [D1(k), D2(k), …, DN(k)] represents the water
extra water. Thus the entitlement is always delivered either in the form allocation decision by the central planner. Note that for any farmer n,
of water, or financial payment. In this study, we determine payments for the allocated amount Dn(k) can differ from the demand dn(k). It is
the reallocation stage through the Vickery Groves Clarkes (VCG) important to note that for every farmer n and time interval k,
mechanism. The VCG mechanism requires the individual valuation for Smin≤Dn(k)≤dn(k), where Smin is the minimum amount of water required
to maintain water flow in the watercourse to guarantee supply to a farm.
Note that any demand that is not met through surface water must be met
by pumping groundwater. Note that while the farmers receive surface
1
This is motivated by the Indus Basin Irrigation System Anwar et al. (2016) water only at the beginning of each interval k, they can pump

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W. Hassan et al. Agricultural Water Management 287 (2023) 108443

groundwater at anytime during the interval. In this study, we have Tanaka and Gupta, 2016; Langbort, 2012; Hobbs et al., 2000. It proves
assumed that each farmer has access to an infinite groundwater reser­ to be an appealing payment calculation mechanism due to its properties
voir. Thus, we assume that the aggregate extraction does not impact the of individual rationality and zero efficiency loss Shoham and
per-unit pumping cost Cg. Next, we discuss the bidding procedure used Leyton-Brown (2008). The function Cn (̂ v n (k), ̂
v − n (k)) represents the
to determine the valuations ̂
v n (k) for the individual farmers. payments to be made by the buyers. To compute these payments, the
central planner calculates P(k) and P− n(k) for each farmer n, where P(k)
2.3. The bidding process = D(k) − E(k)≥ 0 is the water reallocation decision vector, i.e., the
amount of water reallocated to farmers in the time interval k and P− n(k)
At the beginning of the second stage for each interval k, the central is the hypothetical reallocation decision vector. This also denotes the
planner solicits bids from the farmers. The bid for farmer n is repre­ amount of surface water that would have been reallocated to the other
sented by bn(k), which consists of the price per unit of water at which she farmers, if farmer n had not participated in the reallocation process to
is willing to sell or buy water and the number of units of surface water begin with. The generic expression for VCG payment calculation is as
she needs during time interval k. The willingness to pay for each farmer follows:
depends on her valuation of water during the. Hence, bn(k) is the pair of ( )
(5)
Cn (̂v n (k), ̂v − n (k)) = g Pj,− n (k), ̂
v j (k), dj (k) − g(P(k), ̂v j (k), dj (k)),
water demand and water valuation, i.e., bn (k) = (dn (k), ̂ v n (k)), where
dn(k) is the water demand by farmer n and ̂ v n (k)) is the value of water where the term g(Pj,− n (k), ̂
v j (k), dj (k)) represents the aggregate individ­
that farmer n claims for a unit of surface water. Note that the actual ual utilities of all users except buyer and the term g(P(k), ̂ v j (k), dj (k))
valuation vn(k) of a farmer n may be different from the valuation ̂ v n (k)) represents the aggregated individual utilities of all users when the buyer
reported by the farmers to the central agent. The true value of surface is not part of the bidding process. In this study, to aggregate individual
water for farmer depends upon marginal productivity, i.e., profitability utilities we simply add them. Please note that VCG mechansim do not
factors, crop, and production technology, etc. The generic expression for restrict us to use any aggregation procedure. We can aggregate indi­
true valuation of water vn(k) for farmer n during time interval k is as vidual preferences using any aggregation procedure. Therefore, we as­
follows sume that the central planner calculates the payment for each farmer n
vn (k) = f (β), (3) in the time interval k using the following expression
∑ ∑
Cn (̂v n (k), ̂v − n (k)) = uj (Pj,− n (k), ̂
v j (k), dj (k)) − uj (P(k), ̂
v j (k), dj (k)).
where β represents the marginal productivity. In real-settings, the true j∕
=n j∕
=n
valuation vn(k) of a farmer has been observed to depend upon the water
(6)
demand dn(k)Mallios and Latinopoulos (2001), farm size AnTang et al.
(2013), and pumping cost of groundwater Cg (Knapp et al., 2018; where un(k) represents the utility function for farmer n and is given by
Strosser and Kuper, 1994. The relationship of these variables with true
valuation of surface water is well known Olum et al. (2020). For pur­ un (Dn (k), vn (k), dn (k)) = vn (k)Dn (k)
poses of comparison in the results section, we assume the true value of +vn (k)(dn (k) − Dn (k)) (7)
water for farmer n during time interval k as
Cg dn (k) where (dn(k) − Dn(k)) represents the demand which was not met
vn (k) = , (4)
An through the surface water supply by the central planner during the time
interval k.
since the farmer may always choose to meet her demand by pumping In 6, payment of a farmer n who receives water during reallocation is
groundwater if the cost for surface water exceeds that of what she incurs calculated by subtracting the social utility of all other farmers in the
by drawing from the aquifer. Next, we describe the VCG procedure that presence of farmer n from the social utilities of all other farmers in the
the central planner employs to calculate the payments for reallocated absence of farmer n. These payments consider the social impact of a
water. These payments may differ from the reported willingness to pay farmer receiving water through reallocation. Thus farmer’s payment
for each farmer. depends upon how much other farmers can increase their utilities if
water received by farmer n was reallocated to other farmers.
2.4. Water payments Seller Price: To compute payments for sellers, the central planner
calculates the net price of reallocated water by dividing the total pay­
After deciding on water distribution, the central-agent has to decide ments received from buyers by the total water units reallocated among
how much each buyer, who receives water greater than their entitle­ farmers. If not reallocated, the water received by farmers greater than
ment, has to pay and how much financial benefit each seller, who uti­ their demand gets wasted in runoff, and farmers receive no economic
lizes water less than their entitlement and leaves water to get used by benefit for getting water additional to their needs. Sellers are better off
others, will get. To compute the surface water payments, the central by receiving payments greater than zero from the central planner Easley
planner first categorizes the farmers into buyers and sellers by and Kleinberg (2010). Therefore, we assume that the farmers have a
comparing the water allocation decision D(k) with water entitlement E valuation of 0 for each unit of water entitlement which is greater than
(k). Farmers who receive water more than their entitlement, i.e., Dn(k)≥ their demand, i.e., En(k) > dn(k), in the time interval k.
En(k), are categorized as buyers while farmers who receive water less
than their entitlement, i.e., Dn(k)≤ En(k), are categorized as sellers. 3. Measures for performance evaluation
Below, we describe the price-setting process separately for the buyers
and sellers. Here, we present a set of performance indicators for the performance
Buyer Price: To compute surface water payment for buyers, the assessment of the proposed demand-based water allocation mechanism.
Vickrey-Clark-Groves (VCG) mechanism is used Vickrey (1961); Clarke These indicators give socio-hydrological insights into a water allocation
(1971); Groves (1973). The VCG calculates payments so that the buyers and distribution system. Previously, these metrics have been used to
don’t have the incentive to misreport (Varian and Harris, 2014; Nisan assess the performance of several allocation mechanisms worldwide
and Ronen, 2007. Additionally, the VCG ensures fair payments by (Siddiqi et al., 2018; Molden and Gates, 1990; Kaghazchi et al., 2021.
considering the social impact of one buyer on other buyers. The VCG is We define a demand fulfillment ratio αn(k) as a ratio of amount of water
extensively used in other related practical models (Samadi et al., 2012; received D(k) to the water demand d(k). D(k) is the water allocation

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W. Hassan et al. Agricultural Water Management 287 (2023) 108443

Fig. 2. Location of the case study area.

decision by the central planner. The ratio αn(k) for farmer n in the time 3.2. Farm demand fulfillment reliability
interval k is as follows
Farm demand fulfillment reliability pn is the probability of getting
Dn (k)
αn (k) = . (8) water equivalent to a farm n demand in time interval k. This metric
dn (k)
measures the range in which farmers’ water demands are satisfied
throughout the season. If the water demand of a farm n is fully met
The demand fulfillment ratio αn(k) is zero when a farmer receives no
during each interval k in a cropping season, then pn = 1. Farm demand
water. The αn(k) is between zero and one when the water received by a
fulfillment reliability is calculated as follows
farmer is less than her water demand. αn(k) is equal to one when water
delivered is equivalent to the water demand of the farmer. αn(k) is ∑K
min(1, αn (k))
greater than one when water received is greater than the water demand pn = k=1 . (10)
K
for farmer n in the time interval k.
Here, we explain the key metrics for socio-hydrological analysis, 3.3. Network Reliability
including consistency, compliance, reliability, and equity.
Network reliability NE is the mean reliability of all farms in a
3.1. Farm demand fulfillment consistency watercourse. This metric gives total or aggregate reliability at the
watercourse level. The network reliability is calculated as follows
farm demand fulfillment consistency θn is the coefficient of variation ∑N
of the water received to water demand ratio αn(k). It represents the intra- NR = μ(pn ) = n=1 .
pn
(11)
farm fluctuations of water received to water demand ratio for the farm n N
in a watercourse. It also evaluates whether the water supply is consistent
or not for a farm n in a cropping season. When θn is small, a farm has high 3.4. Farm demand fulfillment compliance
consistency in water received to water demand ratio. For example, if a
farmer receive 90% of its demand, i.e., αn(k) = 0.9, over a season, than Farm demand compliance An is the ratio that represents the total
θn = 0 and water supply is consist ant for farm n. The farm water supplies water demand satisfied for a farm n over a complete cropping season. It
can be compared using the farm demand fulfillment consistency metric. considers the total amount of water supplied but does not account for the
Farm demand fulfillment consistency is calculated as follows timing at which the water was supplied. An quantifies how much the
received amount of water matches the water demand irrespective of the
αn (k) =
σ (αn (k))
. (9) time at which water was received. Farm demand fulfillment compliance
μ(αn (k)) can be calculated as follows
∑K
Dn (k)
An = ∑k=1
K . (12)
k=1 dn (k)

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W. Hassan et al. Agricultural Water Management 287 (2023) 108443

parameters. Our results suggest that the proposed mechanism with

water rights performs better in terms of equity, reliability, compliance,
and consistency.

4.1. Study area

The case study area is irrigated by watercourse 91,093/L and is

located at Moza joyia District, Okara, in the province of Punjab,
Pakistan. The case study site map is shown in Fig. 2. The watercourse
91,093/L irrigates 444.43 Acres of land. This watercourse draws water
from the Gogera branch canal, which is a distributary canal of 137 km in
length. The Gogera branch canal takes water from the Lower Bari Doab
Canal (LBDC), which is the main canal of 201 km in length. It provides
surface water to 700,000 ha of land in the Province of Punjab, Pakistan.
It gets water from the Balloki barrage situated on river Ravi. It is a
transboundary 720 km long river that passes through northwestern
Fig. 3. The location of watercourse and land owned by each farmer in the study India and eastern Pakistan. Twenty-four farmers own a portion of the
region. land in the case study region. The location of each farmer and the
This figure is reproduced from Hassan et al. (2021). watercourse in the study area is shown in Fig. 3. The data collected at the
case study site is from July 2018 to October 2018.

The inter-seasonal variability of farm compliance is measured as follows

4.2. Simulations
σ(Ain )
Xn = Cv (Ain ) = . (13)
μ(Ain ) In this section, we compare the proposed mechanism with and
without water rights in the study region. We evaluate both mechanisms
where i represents the season. based on the equity and reliability, compliance and consistency metrics,
the amount of surface water and groundwater used, and water pricing.
We aim to compare both schemes over the realistic range of parameter
3.5. Interval Equity
values. First, we compare both mechanisms using nominal parameter
values for the case study region. Next, we demonstrate the Monte-Carlo
Interval Equity ε(k) is the coefficient of variation of water received to
simulations.
water demand ratios (αn(k)) across the farms in a watercourse during the
time interval k. This concept is derived from the idea that the
4.2.1. Simulation setup
geographical variation in performance can be used to assess equity
Here, we present the summary of data used in our simulation; the
(Molden and Gates, 1990; Kaghazchi et al., 2021. When the variation
interested reader can see details about data sources and calculation
across farms in a watercourse during a time interval k is low, then in­
methods of all input data in Hassan et al. (2021). There are twenty-four
terval equity ε(k) is high, and water allocation in a watercourse is
farmers in the case study region, i.e., N = 24. We analyze the perfor­
equitable when ε(k) = 0. Interval equity quantifies the variation in water
mance of both mechanisms for a cropping season, from July 2018 to
allocation or water supply across different farms, and it evaluates
October 2018, which is of seventeen weeks, i.e., K = 17.
whether or not different farms in a watercourse are getting equal water
The water demand at each farm depends upon the soil moisture level
supply. For example, if the water received by all farmers is 90% of their
of the farm Rowe (2018). To calculate the soil moisture level, we assume
water demand in a time interval k, then perfect interval equity is ach­
that soil moisture level measurement sensors at each farm are available.
ieved. If one farm is receiving 40% of its water demand while another is
The soil moisture dynamics depend upon several factors, including
receiving 80% of its demand, then interval equity is not satisfied. In­
reference evapotranspiration, crop coefficient, deep percolation con­
terval equity is calculated as follows
stant, rain, and irrigation applied Lozoya et al. (2014). Crop coefficient
σ(αn (k)) Kc(t) can be calculated using the remote sensing data ElGhandour et al.
ε(k) = . (14)
μ(αn (k)) (2019), Jayanthi et al. (2001), Irmak et al. (2011). The spatial resolution
of the Reference evapotranspiration ETo(t) data is 1 km × 1 km. ETo(t)
3.6. Equity data is taken from the USGS database USGS (2020). Rain Rn(t) data is
collected from the Center for Hydrometeorology and Remote Sensing
Equity E is defined as the mean of interval equity ε(k) in a cropping database CHRS (2020), and its spatial resolution is 4 km × 4 km. To
season. Equity is calculated as follows prevent over and under irrigation, the upper and lower soil moisture
thresholds are defined, which depend upon the soil type. The study re­
∑K
ε(k) gion is small, and soil properties are similar throughout the study region.
E = μ(ε(k)) = k=1 . (15)
K We assume the upper and lower soil moisture threshold for all farms to
be 0.25 and 0.10, respectively. The initial condition for each farm soil
4. Results moisture level is randomly selected using a uniform random distribution
from the range [0.10, 0.25].
Now, we present a case study to compare the equity, reliability, and The surface water supply information for the watercourse 91,093/L
performance of the proposed mechanism with and without water rights. is not available. We assume that the surface water supply in the study
We use the data from July 2018 to October 2018 to outline the water region watercourse is equivalent to that in an adjacent watercourse as
demand model. Next, we use the collected data in the proposed alloca­ the surface water provided by both watercourses is roughly equal. The
tion and pricing mechanism with water rights to compare it with the surface water provided by the adjacent watercourse is 1.6 × 106 cusec/
proposed mechanism without water rights in the study area. We analyze week On Farm Water Management, P (2017). In the study region, the
both mechanisms for nominal parameter values in the study region, canal efficiency is 75% Frenken (2012). Therefore, 1.2 × 106 cusec/­
followed by Monte-Carlo simulations over the realistic range of model week surface water reaches the study region, i.e., only 75% of the

6
W. Hassan et al. Agricultural Water Management 287 (2023) 108443

Fig. 4. The surface water supply each week and the difference in cost borne by
farmers each week of the season when water is allocated using the proposed
mechanism with and without water rights.

Fig. 6. The total difference in groundwater used, the surface water used, and
the cost induced by farmers when water is distributed using the proposed
mechanism with and without water rights.

water rights is more effective than the proposed mechanism without

water rights. In the proposed mechanism with water rights, farmers get
surface water equal to or greater than their entitlement. In the proposed
mechanism without water rights, farmers may get zero surface water as
farmers only with the higher bid will get water if the surface water
supply is less than the total water demand of the farmers. In the pro­
posed mechanism with water rights compared to the proposed mecha­
nism without water rights, the cost paid by farmers is small as farmers
only have to pay the price for the additional surface water received
along with their entitlement.
Fig. 5. The difference in surface water and groundwater used when water is
distributed using the proposed mechanism with and without water rights.
4.4. Exhaustive Performance Assessment Simulations
designated water discharge.
We evaluate equity, reliability, compliance, and surface water price
Under the proposed distribution scheme, each farmer provides water
to compare the proposed mechanism with and without water rights. To
demand and is willing to pay for the water at the start of each week. The
compare both schemes over the realistic range of parameter values, we
farmers pump groundwater if the surface water supply cannot meet their
carry out Monti-Carlo simulations by changing the parameter values
water demand or the soil moisture level reaches a lower threshold
over a range that mimics the real-world context. All details about the
during the week. The groundwater cost in the study region is 0.10 PKR.
parameter values and their sources is provided by Hassan et al. (2021).
In the case study region, initial water rights are ensured using a roster
shown in Table A1. This roster repeats every week throughout the
4.4.1. Groundwater use, surface water use, and cost incurred by farmers
season.
Figure 6 represents the total difference in groundwater used, the
surface water received, and cost induced by farmers in the study region
4.3. Performance for nominal parameters when water is allocated using the proposed mechanism with and
without water rights. The positive difference in groundwater and surface
We measure the difference in total cost borne by farmers, the dif­ water used shows that more water is being used in the proposed
ference in surface water provided to farmers, and the difference in mechanism without water rights compared to the mechanism with water
groundwater used to compare the proposed mechanism with and rights. The average difference in water used is zero as both mechanisms
without water rights for a nominal set of parameters. The total water are demand based, i.e., the water used in both mechanisms is equal. The
supply in the watercourse each week is shown in Fig. 4. positive cost induced by the farmers in the study region represents that
Figure 5 shows the difference in total surface water, and total farmers are suffering more cost when water is distributed using the
groundwater used when water is distributed using the proposed mech­ mechanism without water rights compared to the mechanism with water
anism with and without water rights. A positive difference in surface and rights. In the mechanism with water rights, farmers only pay for addi­
ground water use means more water is being used in the proposed tional units of surface water they receive along with their entitlement,
mechanism without water rights. The difference in surface water and while in the mechanism without water rights, farmers have to pay for
groundwater used is zero in a few weeks. Fig. 4 shows the difference in each unit of surface water they receive.
cost paid by all farmers when water is distributed using the proposed
mechanism with and without water rights. A positive difference in cost 4.4.2. Farm demand fulfillment consistency
means more cost is being paid by farmers when water is distributed The metric farm demand fulfillment consistency θn provides a farmer
using the proposed mechanism without water rights. In the proposed ability to predict. For example, if a farm receives 50% of its demand in a
mechanism with water rights, farmers only pay the surface water price week and 50% of its demand consistently throughout the season, then
when they are getting additional water along with their entitlement, the consistency would be high, i.e., θn would have a small value. High
resulting in fewer overall payments than in the proposed mechanism farm demand fulfillment consistency provides farmers a level of pre­
without entitlement. dictability, and they can better plan their farming activities Siddiqi et al.
The comparison results indicate that the proposed mechanism with (2018).

7
W. Hassan et al. Agricultural Water Management 287 (2023) 108443

Fig. 7. farm demand fulfillment consistency when water is distributed using the mechanism with and without water rights.

Fig. 8. Inter-seasonal variability in farm compliance for the proposed mechanism with and without water rights.

Figure 7 represents farm demand fulfillment consistency θn for all both the mechanism with water rights perform better compared to the
farms in the study region when water is distributed using the proposed mechanism without water rights as consistency is high (θn have small
mechanism with and without water rights. This result indicates that values) for all farmers in the mechanism with water rights. The results

Fig. 9. Farm demand fulfillment reliability when water is distributed using the mechanism with and without water rights.

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W. Hassan et al. Agricultural Water Management 287 (2023) 108443

Fig. 10. The equity and network reliability for the proposed mechanism with and without water rights.

also indicate that variability within farms is low for both mechanisms, i. reliability point (0 system equity and 1 network reliability) when water
e., farm demand fulfillment consistency is almost the same for all is distributed through the mechanism with water rights compared to the
farmers when water is distributed using the mechanism with and mechanism without water rights.
without water rights, respectively.
5. Discussion and summary
4.4.3. Inter-seasonal variability in farm compliance
To measure each farm’s net surface water deficit, we determine farm In the preceding text, we have presented a novel modified demand-
compliance, i.e., the ratio of total water delivered to total water demand. based water allocation framework that preserves water rights through
We calculate the inter-seasonal variability in farm compliance as shown an initial entitlement-based allocation stage. After the initial allocation,
in Fig. 8. The inter-seasonal variability in farm compliance is low for all the framework reallocates and distributes the surplus water among users
farmers in the study region when water is distributed using the mech­ based on their demand. While the first stage promotes fairness and eq­
anism with water rights compared to the mechanism without water uity among users, the second stage ensures efficient utilization of irri­
rights. In the mechanism with water rights, during each time interval, gation water. Another novel aspect of this research is that it presents a
each farm receives water atleast equal to its water entitlement if its water pricing and valuation system based on the users’ valuation of
demand exceeds its entitlement. In the mechanism without water rights, water. The presented pricing and valuation mechanism is a second-price
farmers may not get the surface water if the water available is less than auction system that is known to guarantee truthful valuation on behalf
the total demand of the farmers and their willingness to pay is small of the bidders both in theory and in practical settings. This mechanism
compared to other farmers. Therefore, the variability in compliance is ensures a fair pricing scheme by taking into account the social impact of
less in the mechanism with water rights compared to the mechanism a single user on other users, and it has not been considered for water
without water rights. resource management problems prior to this study. The performance of
the allocation mechanism has been assessed from different socio-
4.4.4. Farm demand fulfillment reliability hydrological and economic perspectives. Although in this paper, the
The farm demand fulfillment reliability pn when water is distributed performance of the proposed allocation scheme has been evaluated
using the mechanism with and without water rights is given in Fig. 9. against a particular region in the IBIS, the framework is general and can
Farm demand fulfillment reliability is higher when water is distributed be tailored according to the local needs for implementation in other
using the mechanism with water rights than without water rights. In the regions and countries as well.
mechanism with water rights, during each time interval, each farm re­ Our results demonstrate that the incorporation of water rights in the
ceives water atleast equal to its water entitlement if its demand exceeds allocation framework leads toward a more equitable distribution of
its entitlement. In the mechanism without water rights, farmers may not water without significantly impacting water utilization. It is important
get the surface water, if water available is less than the total demand of to note here that while our results have been demonstrated for a selected
the farmers and its willingness to pay is small compared to other allocation scheme, the same framework is relevant for other real-world
farmers. The variability in demand fulfillment reliability among farms is allocation schemes as well. Thus, the derived conclusions are also
low, which shows that each mechanism is consistent in terms of applicable to other allocation frameworks that may be a blend of
reliability. different water rights systems and demand-based appropriation philos­
ophies. This is evident from the observations drawn in studies of many
4.4.5. Network reliability and system equity real-world systems. For instance Hipel et al. (2013) and Xiao et al.
For the last comparison, we plot network reliability and system eq­ (2016) report instances where the incorporation of water rights in
uity as shown in Fig. 10. For perfect system performance, the system’s standard demand-based mechanisms has led to improved equity and
trajectory should lean towards the point where equity is 0 and reliability water-use efficiency. In another work, Hamm et al. (2013) observes that
is 1 in Fig. 10. These results indicate that the performance of the fairness and justice in water regulation systems lead towards increased
mechanism with water rights is high compared to the mechanism compliance of users. As shown in the previous section, our results also
without water rights. The results in Fig. 10 show that the system’s tra­ demonstrate improvement in compliance with the incorporation of
jectory for reliability and equity tends towards the perfect equity and water rights in the demand-based mechanism. Further in line with our

9
W. Hassan et al. Agricultural Water Management 287 (2023) 108443

Table A1
Rotational Roster along the watercourse 91,093/L which ensure water rights of the each farmer in the study area Hassan et al. (2021). This table is retrieved from the
study area irrigation authority office.
Farm Number Area Number Area (acre) Irrigation time (Hr) Draining time (Hr) Filling time (Hr) Net allotted time (Hr) Initial Timing Final Timing

1 27 8.4375 3.18 0.000 0.000 3.18 Mo- 06:00AM Mo-09:11 AM

2 27 2.0625 0.77 0.000 0.000 0.77 Mo-09:11 AM Mo-09:57 AM
3 26,42,43,48 21.50625 8.10 0.050 0.000 8.15 Mo-09:57 AM Mo-06:03 PM
4 26,27,42,43,48 21.31875 7.93 0.250 0.000 8.18 Mo-06:03 PM Tu-02:14 AM
5 42,44,47,48 34.46875 12.83 0.000 0.000 12.83 Tu-02:14 AM Tu-03:04 PM
6 27,42,49,71 67.1375 24.82 0.200 0.000 25.02 Tu-03:04 PM We-04:05 PM
7 44,46,47 7.4625 2.83 0.250 0.000 3.08 We-04:05 PM We-07:10 PM
8 73 9.4625 3.58 0.000 0.000 3.58 We-07:10 PM We-10:45 PM
9 72,73 19.38125 7.23 0.050 0.000 7.28 We-10:45 PM Th-06:02 AM
10 50,72,71,51,69 63.23125 23.40 0.500 0.000 23.90 Th-06:02 AM Fr-05:56 AM
11 51,69 13.54375 5.10 0.000 0.000 5.10 Fr-05:56 AM Fr-11:02 AM
12 69 8.3125 3.15 0.000 0.000 3.15 Fr-11:02 AM Fr-02:11 PM
13 52 9.05625 3.35 0.000 0.000 3.35 Fr-02:56 PM Fr-06:17 PM
14 60 1.15625 0.47 0.000 0.000 0.47 Fr-06:17 PM Fr-06:45 PM
15 52,68 9.1625 3.40 0.000 0.000 3.40 Fr-06:45 PM Fr-10:09 PM
16 72,74,75,76,68 31.3375 11.65 0.350 0.000 12.00 Fr-10:09 PM Sa-10:09 AM
17 74 4.40625 1.70 0.000 0.000 1.70 Sa-10:09 AM Sa-11:51 AM
18 75 1.09375 0.42 0.000 0.000 0.42 Sa-11:51 AM Sa-12:16 PM
19 68,69,76,77 36.6 13.50 0.367 0.000 13.87 Sa-12:16 PM Su-02:16 AM
20 76,97,98 30.50625 11.37 0.150 0.000 11.52 Su-02:16 AM Su-01:47 PM
21 96,97,98 10.4375 3.95 0.000 0.000 3.95 Su-01:47 PM Su-05:44 PM
22 97 2.575 1.07 0.000 0.000 1.07 Su-05:44 PM Su-06:48 PM
23 100,117 23.34375 8.67 0.002 0.000 8.67 Su-06:48 PM Mo- 03:43 AM
24 98,99 8.43125 3.20 0.000 0.917 2.28 Mo- 03:43 AM Mo- 06:00 AM

results, similar effects have also been observed for consistency in In the simulation section of our study, we have used the proportional
real-world studies (see the work by GhaffariMoghadam et al. (2022). rule to allocate initial water rights among users in the first stage of the
A noticeable aspect from the results of our performance evaluation is proposed scheme. This rule of initial water allocation is not water effi­
the improvement in reliability. Reliability depends heavily on the total cient, despite being used in large irrigation systems like the Indus basin
supply of water. Since the assumed water supply in both mechanisms has irrigation system (Freebairn and Quiggin, 2006; Goesch and Hanna,
been kept the same in all simulations, the observed increase in reliability 2002; Gómez-Limón et al., 2020; Lefebvre et al., 2012; Co-Operation,
may appear to be counter-intuitive at first. Here, we wish to emphasize 2015. Note that the selected rights allocation system is merely an
that the increase in reliability does not reflect an increase in supply but illustrative example, and the proposed scheme should not be viewed as
instead stems from its relation to the Demand fulfillment ratio αn(k). being limited to these examples alone. It is important to point out that
While the purely demand-based mechanism results in an allocation such there are multiple ways to allocate initial water rights, and priority
that the value of αn(k) for any user is either 1 or 0 (except for one rights are one of them. Recent studies suggest that this is one of the
partially fulfilled user), the rights-preserving allocation mechanism en­ efficient ways to allocate initial water rights (Goetz et al., 2017;
sures that there is no user with a value of 0 for αn(k). This may result in Gómez-Limón et al., 2021; Gutiérrez-Martín et al., 2022; Martinez and
some users with very low demand being serviced by virtue of their water Esteban, 2014. Therefore, allocating initial water rights with priority
rights, who otherwise would not have been serviced in the purely rights in the first stage of our proposed scheme could be an exciting
demand-based mechanism. Thus, many users obtain a high value of direction for future research. However, allocating initial water rights
αn(k) in the proposed scheme, as compared to the purely demand-based using any of the water rights allocation schemes would not change our
one, which ultimately results in the observed increase in reliability. study results.
Similar results have also been observed in some real-world cases, for A promising direction of future research relates to the space of Equity
instance, by Afshar et al. (2015), Zeng et al. (2015), Zeng et al. (2016), and Reliability shown in Fig. 10. Based on the supply of water and the
Zeng et al. (2015) and Schwabe et al. (2020), where similar in­ allocation scheme that is employed, any irrigation system will operate at
terventions resulted in water allocation with improved reliability. a single point in this space. Ideally, the planner would want the system
Previously, we have argued that a desirable feature of the rights- to operate as close to the perfect Reliability and Equity point as possible.
preserving framework is that it increases equity in distribution The structure of the simulated point clouds for the two different allo­
without decreasing the overall utilization of surface water. This is cation mechanisms suggests that the allocation plays a critical role in
evident from our results, where it can be observed that utilization re­ determining the worst-case performance. The span of the cloud for the
mains the same across the mechanisms with and without water rights. mechanism with water rights lies in a more desirable region of the
This is in contrast to purely supply-based mechanisms, which are known performance space as compared to the mechanism without water rights.
to result in inefficient utilization of water. In our proposed framework, Furthermore, the shape of the cloud suggests that Reliability and Equity
however, this inefficiency is dealt with by the demand-based realloca­ are not independent of one another but are constrained via the water
tion stage. Any allocated quantity of surface water that exceeds that allocation mechanism that is employed. Further research on the per­
particular user’s demand is reallocated in this stage to another user formance limits of different allocation frameworks in the Equity-
whose demand is yet to be fulfilled. In this way, any wastage of surface Reliability space can greatly benefit policy-makers while making de­
water is avoided in a manner similar to a purely demand-based mech­ cisions regarding water allocation in real-world irrigation systems.
anism. Therefore, the proposed framework is able to obtain an increase
in equity without a corresponding decrease in utilization. Note that we Declaration of Competing Interest
disregard the various inefficiencies and losses that may be introduced in
the distribution stage. Indeed, these inefficiencies will exist regardless of The authors declare that they have no known competing financial
whatever allocation mechanism is used and must be dealt with interests or personal relationships that could have appeared to influence
separately. the work reported in this paper.

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W. Hassan et al. Agricultural Water Management 287 (2023) 108443

Data Availability Hassan, W., Manzoor, T., Jaleel, H., Muhammad, A., 2021. Demand-based water
allocation in irrigation systems using mechanism design: a case study from pakistan.
Agric. Water Manag. 256, 107075.
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Rev. 71, 1661.
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Table A1. revelation auction in the context of energy markets with nonconcave benefits.
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