In 1991, to mitigate the effects of a five-year drought, the California department of Water Resources bought water from farmers, landlords, and agencies in northern and central California and resold it to urban and agricultural areas. This study found that although operating costs and crop sales were substantially reduced for farmers who participated in the Bank, the Bank's economic impact was not large compared to the general agricultural economy of the region and to historic variations in the agricultural sector, and that participating farmers increased their farm investment. Recommendations for future banks include spreading purchases and rotating farmers to diffuse the bank's negative impacts, considering a lower water purchase price, using standard rules and contracts, and developing procedures to minimize divisiveness among landlords, tenants, and local businesses.
This report is part of the RAND Corporation monograph report series. The monograph/report was a product of the RAND Corporation from 1993 to 2003. RAND monograph/reports presented major research findings that addressed the challenges facing the public and private sectors. They included executive summaries, technical documentation, and synthesis pieces.
Permission is given to duplicate this electronic document for personal use only, as long as it is unaltered and complete. Copies may not be duplicated for commercial purposes. Unauthorized posting of RAND PDFs to a non-RAND Web site is prohibited. RAND PDFs are protected under copyright law. For information on reprint and linking permissions, please visit the RAND Permissions page.
The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.