| OCR Text |
Show regulation of water are assumed given, and are not explicitly brought into the analysis of the study* We also assume as given, certain structual characteristics of the state's water system, such as its geography, hydrology, and storage and transport facilities* As will be apparent later, even certain economic aspects of the problem of water allocation have been given little, if any, attention in this study. In particular, these economic aspects are the nature of the pricing system for water, and the normative criteria for judging investment in water facilities* While the results of the study do throw some light on these aspects, they have not been the prime motivating force for the methodology and the purpose of this study. As mentioned at the outset, we are concerned with certain aspects of the problem of water allocation, one of which is the existing pattern of water allocation. Is it an optimum one? The criteria and methodology of this study go part of the way toward resolving this difficult and apt- to- be- controversial question. To do a more complete job, we nee, d information on the marginal cost of supplying water intake. The design and scope of this study did not include such requirements * What we have done, however, is to define and formulate a ( joint) marginal value product concept which goes beyond the restricted ceteris paribus concepts heretofore used as one of the basic criteria to judge the efficiency of an existing allocation of water.* This innovation is then used as a basis for determining ^ For an example of the ceteris paribus approach, see [ 2], 2 |
