Analysis of the potential and problems of new institutional economics for third world development

Purpose – The aim of this paper is to provide a critical evaluation of the potential of new institutional economics (NIE) in third world development.

Design/methodology/approach – The paper reviews various theories under NIE from both conceptual and empirical perspectives. It then reviews the various definitions of institutions and show that institutions are essential to overcome problems of information and uncertainty.

Findings – The review finds that weak institutions can undermine development and hence governments in developing countries should strengthen their institutions to provide greater scope for efficient functioning of markets. Where the market does not work owing to high transactions costs, traditional institutions of collective action and group decision making can work and hence need to be recognised.

Research limitations/implications – The major implications of the paper is that in developing countries, a clear understanding of various institutions such as user groups, inter-linked credit markets, rotational irrigation etc. is needed before they are replaced or modified by other institutions. The main limitations of NIE are that there can be capture by elites of various institutional innovations in rural areas, and that it does not explicitly consider income distribution and uncertainty which are glossed over and hence remain areas for future research.

Originality/value – This paper critically reviews the various institutional environments that developing countries face in addressing development issues.

New institutional economics: it's nature, potential and the future

It is generally accepted that institutional problems have severely constrained development in many countries regardless of significant achievements in technology and other reforms. Both the Old and New Institutional Economics have relevance in understanding the lack of progress in many countries in Asia and Africa. Institutions generally refer to the "framework within which human interactions take place. Two major strands of NIE are the transaction costs and the collective action approach. The NIE implies that traditional rural institutions such as user groups, rotating credit and irrigation associations, interlinked credit etc. are institutions that have emerged in place of the market due to lower transactions costs. The successful management of common property resources such as water, forests, wetlands etc using local arrangements imply that institutions need to be interpreted in broader terms and the simple dichotomy of market or the government is too limited to understand the development process. New thinking is required in developing institutions that are structurally suited for management at the local level. Such an approach will have better chance to succeed compared to a process based upon the market.

Balancing environmental impacts and benefits of wastewater reuse

Wastewater reuse is being widely promulgated to help address the global freshwater resource crisis. It can assist in reducing extraction of freshwater from the environment, and reuse of wastewater lessens the need for environmental discharge, which is clearly beneficial to receiving waters. But the practice itself also has the potential to be detrimental to natural and human environments: soil structure can become degraded, aquifers may be polluted, and human health may be threatened. The challenge facing natural resource managers is to identify the potential benefits and risks, and to achieve an appropriate balance. This paper describes environmental benefits and threats concomitant with the reuse of wastewater. We frequently draw upon examples from China and Australia-two countries that face particularly daunting water resource
challenges-but the principles can be.extended far beyond these geographical bounds and are applicable to
many parts of the world.

Institutional economics approach to irrigation management with special reference to developing countries

Neoclassical economics has failed to address irrigation management issues in developing countries successfully. Institutions are at the heart some of these failures. Many academics in various disciplines in the social sciences now emphasize the need to pay attention to the multitude of informal institutions such as rotational irrigation in developing countries and not to treat them as irrelevant for development. Water user associations have been initiated for irrigation management in many countries. These have shown much promise although many problems still constrain the full adoption of this institutional mode. Water pricing is still at its infancy and significant problems remain in the use of the market system for improved management of irrigation water.

Agricultural intensification and loss of matrix habitat over 23 years in the West Wimmera, south-eastern Australia

The global trend toward more intensive forms of agriculture is changing the nature of matrix habitat in agricultural areas. Removal of components of matrix habitat can affect native biota at the paddock and the landscape scale, particularly where intensification occurs over large areas. We identify the loss of paddock trees due to the proliferation of centre pivot irrigation in dryland farming areas as a potentially serious threat to the remnant biota of these areas. We used a region of south-eastern Australia as a case study to quantify land use change from grazing and dryland cropping to centre pivot irrigation over a 23-year period. We also estimated rates of paddock tree loss in 5 representative landscapes within the region over the same period. The total area affected by centre pivots increased from 0 ha in 1980 to nearly 9000 ha by 2005. Pivots were more likely to be established in areas which had originally been plains savannah and woodlands containing buloke (Allocasuarina luehmannii), a food source for an endangered bird. On average, 42% of paddock buloke trees present in 1982 were lost by 2005. In the two landscapes containing several centre pivots, the loss was 54% and 70%. This accelerated loss of important components of matrix habitat is likely to result in species declines and local extinctions. We recommend that measures to alleviate the likely negative impacts of matrix habitat loss on native biota be considered as part of regional planning strategies.

Wastewater irrigation: the state of play

As demand for fresh water intensifies, wastewater is frequently being seen as a valuable resource. Furthermore, wise reuse of wastewater alleviates concerns attendant with its discharge to the environment. Globally, around 20 million ha of land are irrigated with wastewater, and this is likely to increase markedly during the next few decades as water stress intensifies. In 1995, around 2.3 billion people lived in water-stressed river basins and this could increase to 3.5 billion by 2025. We review the current status of wastewater irrigation by providing an overview of the extent of the practice throughout the world and through synthesizing the current understanding of factors influencing sustainable wastewater irrigation. A theme that emerges is that wastewater irrigation is not only more common in water-stressed regions such as the Near East, but the rationale for the practice also tends to differ between the developing and developed worlds. In developing nations, the prime drivers are livelihood dependence and food security, whereas environmental agendas appear to hold greater sway in the developed world. The following were identified as areas requiring greater understanding for the long-term sustainability of wastewater irrigation: (i) accumulation of bioavailable forms of heavy metals in soils, (ii) environmental fate of organics in wastewater-irrigated soils, (iii) influence of reuse schemes on catchment hydrology, including transport of salt loads, (iv) risk models for helminth infections (pertinent to developing nations), (v) microbiological contamination risks for aquifers and surface waters, (vi) transfer efficiencies of chemical contaminants from soil to plants, (vii) health effects of chronic exposure to chemical contaminants, and (viii) strategies for engaging the public.

Some aspects of photosynthetic characteristics in a set of perennial irrigation reservoirs located in five river basins in Sri Lanka

Phytoplankton primary productivity of eleven irrigation reservoirs located in five river basins in Sri Lanka was determined on a single occasion together with light climate and nutrient concentrations. Although area-based gross primary productivity (1.43–11.65 g O2 m−2 d−1) falls within the range already established for tropical water bodies, net daily rate was negative in three water bodies. Light-saturated optimum rates were found in water bodies, with relatively high algal biomass, but photosynthetic efficiency or specific rates were higher in water bodies with low algal biomass, indicating nutrient limitation or physiological adaptation of phytoplankton. Concentrations of micronutrients and algal biomass in the reservoirs are largely altered by high flushing rate resulting from irrigation release. Underwater light climate and nutrient availability control the rate of photosynthesis and subsequent areabased primary production to a great extent. However, morpho-edephic index or euphotic algal biomass in the most productive stratum of the water column is not a good predictor of photosynthetic capacity or daily rate of primary production of these shallow tropical irrigation reservoirs.

Competitive sorbtion of metals in water repellent soils: implications for irrigation recycled water

Australia is a water-stressed nation and demand on potable water supply is increasing. Consequently water conservation and reuse are increasingly becoming important. Irrigation of recycled wastewater on water repellent soils is a technology that is being trialled as a means of improving crop production and conserving potable supply. However, recycled water contains potentially harmful heavy metals. This paper reports the competitive sorption and desorption of several common heavy metals found in soils collected from a farm located in the south-east of South Australia. The soil from this location is severely water repellent, but some sites were amended with kaolinite clay (Si₄Al₄O₁₀(OH)₈) about 7 and 15 years ago. The metals studied were Cu, Pb, Cd, Cr, Ni, and Zn. Competitive sorption of the metals was distinctly observed. For all heavy metals, the quantity of metal sorbed was higher in amended soil, and there was a strong correlation between the specific sorption to total sorption ratio and the amount of clay in the soil. The sorption intensities varied with metal, Cr, Pb, and Cu having a high sorption tendencies and Zn, Cd, and Ni having comparatively low sorption tendencies. The total sorption capacity for all metals increased in clay-treated soils compared with non-treated soils. On average, clay-amended water repellent soils had a 20–40% increased capacity to adsorb total metals; however, this increase was largely caused by the increased capacities to adsorb Zn, Cd, and Ni. The effect of clay treatment largely enhanced the sorption capacity of relatively weakly adsorbing heavy metals. The implications for using recycled wastewater on the long-term sustainable agro-environmental management of these soils are discussed.

Unhealthy landscapes: policy recommendations on land use change and infectious disease emergence

Anthropogenic land use changes drive a range of infectious disease outbreaks and emergence events and modify the transmission of endemic infections. These drivers include agricultural encroachment, deforestation, road construction, dam building, irrigation, wetland modification, mining, the concentration or expansion of urban environments, coastal zone degradation, and other activities. These changes in turn cause a cascade of factors that exacerbate infectious disease emergence, such as forest fragmentation, disease introduction, pollution, poverty, and human migration. The Working Group on Land Use Change and Disease Emergence grew out of a special colloquium that convened international experts in infectious diseases, ecology, and environmental health to assess the current state of knowledge and to develop recommendations for addressing these environmental health challenges. The group established a systems model approach and priority lists of infectious diseases affected by ecologic degradation. Policy-relevant levels of the model include specific health risk factors, landscape or habitat change, and institutional (economic and behavioral) levels. The group recommended creating Centers of Excellence in Ecology and Health Research and Training, based at regional universities and/or research institutes with close links to the surrounding communities. The centers' objectives would be 3-fold: a) to provide information to local communities about the links between environmental change and public health ; b) to facilitate fully interdisciplinary research from a variety of natural, social, and health sciences and train professionals who can conduct interdisciplinary research ; and c) to engage in science-based communication and assessment for policy making toward sustainable health and ecosystems.

Game theory applications in natural resource management : review of evidence, problems and potential

Game theory is a rapidly advancing approach to structure and understand complex management problems in the natural resources sector in both the developed and developing countries. Many natural resource problems are complex due to common property and public goods characteristics. Despite these limitations many researchers have used game theory to analyze water shed management, irrigation water management, grazing land management, and managing other ecological resources. The prisoner’s dilemma game has been widely used. The work of Runge shows that collective action is feasible if a critical mass of people can cooperate. The use of game theory is hindered by lack of information, paucity of empirical applications and the lack of interest by policy makers who wish quick answers to critical policy issues. The potential still remains high for game theory to be productively used both in developing and developed countries.

Managing sport in drought-new stakeholders and new governance issues : a case study

Globally, almost every nation is facing some form of water crisis (World Commission on Water 2000). In Australia, the sport and recreation industry is one of the highest consumers of water. Other high water consuming industries (such as agriculture and farming) have been forced to adhere to strict managerial and governance reform due to the water crisis, yet in the sport and recreation industry, such changes are yet to be implemented and fully realised across the sector.

This research examines the impacts of drought and sustainable water management for sport and recreation. Specifically, it provides a case study of sport and recreation provision in a municipality that has already undergone considerable reform due to long-term drought. Sport and recreation use water for purposes such as irrigation of playing fields/pitches, filling swimming pools, stadium amenities and facilities, kitchens, maintenance and cleaning, and clubhouse amenities.

For sports that are heavy users of water for the maintenance of playing fields (such as soccer, Australian Rules football, rugby league, rugby union, grass and clay tennis courts to name a few) the impacts of drought and water restrictions have been severe. Some sports have reported an increase in the risk of injury to participants because of the condition of un-watered playing fields (Sport and Recreation Victoria 2007). Others have been forced to delay or shorten their seasons (Sleeman 2007), or worse still, cancel training and organised competition completely (Connolly and Bell 2007). While the impact of water restrictions has been profound on most sports, there are some sports that are not heavy water users and the impact of drought and water restrictions has been minimal. This problem creates issues and apparent inequities raising the need to further examine water consumption in sport and recreation. The potential outcome that arises is that the future of those sports that cannot conduct their competitions may be disadvantaged, while other sports that do not have such problems may be able to flourish.

Water, and those who control the supply of it, then defines which sports are able to flourish and sustain sport development pathways, compared to those whose survival may be in jeopardy. This research explores the stakeholder management and governance issues that have resulted for sport and recreation in the City of Greater Geelong (CoGG) located in Victoria, Australia--a region in long-term water crisis. The supply of sport and recreation facilities in the CoGG (like most municipalities in Australia) is largely the responsibility of the municipal council. The corporation responsible for the supply of water to the municipality is Barwon Water.

Although other sport and recreation facilities exist in the CoGG, the municipal council of CoGG owns and maintains over 120 sporting ovals (including the stadium used by its professional Australian Football League (AFL) team, the Cats), six swimming pools, and three golf courses. The CoGG host their professional AFL team, a range of local, national and international sport events, and provide a wide range of sport and recreation facilities for the community residents.

Eight interviews were conducted in total. Interviews were conducted with representatives from CoGG municipal council (who are responsible for the delivery of sport and recreation services and facilities in Geelong), and representatives from Barwon Water (who are responsible for the ongoing provision and maintenance of sport and recreation services and facilities) through the provision of water. Results show that the ten highest users of water in the municipality are sport and recreation facilitieswhich between them use almost one-third of the city's total water consumption (City of Greater Geelong 2006).

The municipal council is under considerable pressure to find ways to continue to provide sport and recreation opportunities for community members, as well as professional athletes and teams who use these facilities despite water restrictions. After all, these facilities provide benefit to spectators and participants, as well as businesses that rely on visitors to Geelong for sport and recreation events.

Due to such pressures, from 2007, the CoGG and Barwon Water agreed to provide the sport and recreation sector with water allocations rather than to be denied of all water under the water restriction regimes in place in the municipality. During 2007 summer sport season, this allowed the CoGG to keep 16 of its 120 sporting ovals open for participation through allocating all available water to these fields in order to keep them safe and playable. However, CoGG and Barwon Water were required to devise a rating scale to determine which sports (and sport facilities) were to share the allocated water, and which were not. These decisions also had knock on effects through sports. In order to ensure the safety of the playing surfaces, the CoGG and Barwon Water also restricted use of fields to competition only, therefore sport participants were forced to train on local beaches and other parkland areas-transferring issues of safety and public liability to other locations and facilities in the community. Further, it was reported that scheduling of competition seasons and individual matches; as well as the allocation of "home ground" gate receipts and concessions profits were required to be governed by the CoGG and Barwon Water as the competing sports were unable to agree. Perhaps more importantly, the rating scale developed for water allocation also resulted in some sports being rated as ineligible for water and as a result were unable to stage their entire competitions.

Clearly, the water allocation rating scale, and approach taken in this municipality to the continued delivery of sport and recreation has provided a workable solution. However, this study also signals that new stakeholders have entered the arena for the governance of sport. Governance structures in sport and recreation are being impacted as a result of the water crisis.

Those making decisions about which sport and recreation activities and/or facilities will be assisted with water resources are being made by local councils and water corporations. Sport managers are being required to understand existing areas of knowledge (such as turf management) in different ways, to gain knowledge in new areas (such as sustainable water management), and to lobby new stakeholder groups (such as water corporations) in order to secure their futures. The continued existence of some sports is no longer in the hands of governing bodies, but in the hands of local councils, and water corporations.

Clearly, any of the solutions implemented as discussed above, require multiple stakeholders to interact, and to reach agreement in order to assist in sustainable management of water in sport and recreation. In this sense, the management of water in sport (and all other industries) is more than a rational decision about policy, legislation, restrictions and resource allocations. It is a social and political process requiring scholarly attention for practical solutions.

Absorption and desorption characteristics of fluoride in the calcareous and siliceous sand sheet aquifers of south-west Victoria, Australia

This study assessed the sustainability of utilising groundwater systems to
manage an aluminium smelter's fluoridated trade wastewater stream. Replacing ocean discharge of the wastewater with land irrigation is one option. Using a groundwater model (developed using MODFLOW incorporating parameter estimation software (PEST-ASP)), we found that most of the groundwater flow takes place through surface sands. Fluoride is adsorbed in these sands during the drier summer months, but desorption is rapid when winter rain flushes the aquifer. Underlying clays and other layers prevent significant contamination of the deeper aquifer.

Irrigation with reclaimed water at Portland Aluminium

Through extensive laboratory and field based analysis of soil chemical and physical processes, this research identified and addressed key management issues associated with the sustainable irrigation of municipal wastewater onto sandy water repellent soils, overlaying a shallow aquifer, in an environmentally significant coastal system.

Water regime and salinity changes in wetland macroinvertebrate communities

The research successfully showed how biological communities change in wetlands that are affected by salinity and altered water regimes as a result of irrigation and river regulation. As an outcome of the study, recommendations have been made for the future management of wetlands in the Kerang region in northern Victoria.