In response to the increased competition for water, the Chinese government has determined to promote water-saving irrigation (WSI) followed by a range of institutional arrangements and policy goals. Three management mechanisms are analyzed in this study in terms of effectiveness, including the top-down regulation mechanism using direct control or economic instruments, the design-bid funding mechanism mobilizing local governments by competitive grants program, and the bottom-up participation mechanism transferring more irrigation management responsibilities to end-users. Although the WSI management has achieved notable improvements by the combination of different mechanisms, conflicts among different policy goals, uneven distribution of financial resources, and insufficient participation from water users caused the difficulty in aligning stakeholders’ incentives. Approaches are needed to enable sustainable management by coordinating incentives from different stakeholders in the management, as well as incorporating end water users to assist decision-making.
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