| China is one of the thirteen countries in the world that is short of fresh water and have serious water scarcity problem. The average per capita water availability in China is lower than one fourth of that of the world average. China is also the world's largest irrigation country, with the irrigation area reaching 800,000 million mu in year 1999. It is expected that by year 2030 the grain demand in China will be increased by 50%. Since the possibility of expanding cultivated land will be very limited, the extension of irrigated cultivated area will be crucial to future food security.However, China is encounted with a great number of problems in relation to its development of irrigated agriculture, such as the supply-demand gap of water resources, deterioration of ecological environment of agricultural water resources, and etc. These problems could be attributed to various reasons, one of the most important factor among which is the low efficiency of water usage in agricultural production. Take grain production as an example, the amount of water used for per unit output of grain in China is 2 to 2.5 times that of the developed countries. This could be explained, one the one hand, by the backwardness of the water-saving technology itself; and one the other hand, by the inadequacy and lack of water-saving incentive system in current agricultural water resource management, of which the problem in water rights, water pricing and market system, as well as in management system in irrigation area are the most prominent.This thesis, by utilizing knowledge and analyzing skills in economics of development, economics of water resources and environment, economics of institutions, game theory and neo-classical economic theories, explores the fundamental meanings of sustainable utilization of agricultural water resources, analyze the institutional incentive of different institutional arrangement of water rights, water markets on the utilization of water-saving technology, the economics incentive of water pricing system and management system in irrigation area on the water-saving technology usage and water utilization efficiency improvement. Studies have also been carried out on the interactive relations among water resource usage behavior and the institutional reforms with respect to water rights, water markets, water pricing, management of irrigated area, etc.The structure of the thesis is as follows:The first part of the thesis consists Chapter One, Introduction, and Chapter Two, Literature Review. In this part, the author states the problem and proposed objective ofthe research. Past research works in the field have also been reviewed by the author inthis part.The second part of the thesis, Chapter Three, postulates the analytical framework of the paper. The problem of currently unsustainability of water usage in agricultural production in China has been raised, fundamental meaning of sustainable utilization of water resources in agricultural production has been explored. It is proposed that the objective of sustainable utilization of water resources in agricultural production could only be obtained with improved allocation of resources realized by water rights, market and government regulation in place.The third part of the thesis is composed of Chapter Four, Five, Six and Seven. It first analyzes the effects of combined effort from both government regulation and market system on the improvement of water resource allocation under the condition of market economy, with exploration on both theory and operation in reality in relation to water rights and water market system. A trial attempt has been made on the analysis of initial water rights allocation in sub-irrigated area, using a set of indicators. Case studies have also been carried out to further explain the importance of establishment of water rights system in sub-irrigated area and its impact on the optimization of water resource allocation. It is suggested that market allocation system must be in place before the owners of water rights conducting trading...
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