Retaining population with water? Irrigation policies and depopulation in Spain over the long term
Investigador:
Cazcarro Castellano, Ignacio
Congreso:
Regional Science Dialogues for Peace and Sustainable Development. European Regional Science Association
Tipo de participación:
Comunicación oral
Otros autores:
Ignacio Cazcarro, Miguel Martín-Retortillo, Guillermo Rodriguez-Lopez, Ana Serrano, Javier Silvestre
Año :
2024
Lugar:
Hybrid- Online (Terceira island, Azores, Portugal)
Depopulation, especially, but not only, rural, has become a major concern across many advanced and developing economies. This is particularly relevant in Spain, a country also characterized by severe environmental constraints on agricultural growth. As one type of place-based policy, irrigation programs in rural and urban areas have been claimed to contribute to the resettling of populations and reducing outward migration, by increasing agricultural output, productivity, competitiveness and, consequently, employment and the standard of living. However, no evaluation of the causal effect of irrigation, a heavily used policy both historically and currently, on population has been conducted to date. This article aims to elucidate on this relationship, using municipal-level data over the period 1910-2011 and exploiting a staggered difference-in-differences design. We engage with a recent literature that has turned to the use of historical data to analyze spatial aspects of economic activity, as long-term databases can offer better insights than modern data alone, especially in policy evaluation. Overall, we find a positive and significant effect on population only for irrigation developments that started in the relatively distant past. Principally, in the first peak in irrigation during the third quarter of the twentieth century. The effect is even negative for the most recent irrigation developments. At the same time, we find stronger effects in the smallest municipalities and municipalities farther away from cities, the latter less influenced by urban agglomeration externalities. In any case, effects are temporary or tend to level off. The results also show that one way of overcoming diminishing returns of irrigation over time is to greatly increase its intensity. However, there are trade-offs. We discuss the policy implications of the findings in light of current policies (for the 2022-2027 period), and in terms of environmental and economic costs of increasing the intensity of irrigation.
Depopulation, especially, but not only, rural, has become a major concern across many advanced and developing economies. This is particularly relevant in Spain, a country also characterized by severe environmental constraints on agricultural growth. As one type of place-based policy, irrigation programs in rural and urban areas have been claimed to contribute to the resettling of populations and reducing outward migration, by increasing agricultural output, productivity, competitiveness and, consequently, employment and the standard of living. However, no evaluation of the causal effect of irrigation, a heavily used policy both historically and currently, on population has been conducted to date. This article aims to elucidate on this relationship, using municipal-level data over the period 1910-2011 and exploiting a staggered difference-in-differences design. We engage with a recent literature that has turned to the use of historical data to analyze spatial aspects of economic activity, as long-term databases can offer better insights than modern data alone, especially in policy evaluation. Overall, we find a positive and significant effect on population only for irrigation developments that started in the relatively distant past. Principally, in the first peak in irrigation during the third quarter of the twentieth century. The effect is even negative for the most recent irrigation developments. At the same time, we find stronger effects in the smallest municipalities and municipalities farther away from cities, the latter less influenced by urban agglomeration externalities. In any case, effects are temporary or tend to level off. The results also show that one way of overcoming diminishing returns of irrigation over time is to greatly increase its intensity. However, there are trade-offs. We discuss the policy implications of the findings in light of current policies (for the 2022-2027 period), and in terms of environmental and economic costs of increasing the intensity of irrigation.