Water markets as a vehicle for reforming water resource allocation in the Murray-Darling Basin of Australia
Date
2004
Authors
Crase, Lin
Pagan, Phillip
Dollery, Brian Edward
Journal Title
Journal ISSN
Volume Title
Publisher
American Geophysical Union
Abstract
Water trade and the establishment of water markets continue to gain popularity among legislators as a vehicle for progressing the reform of the water resources sector in Australia. This has manifested itself at the most recent meeting of the Council of Australian Governments, where a range of changes to address the declining health of inland rivers included the strengthening of water property rights. These views appear to be premised on the belief that nonattenuated water rights are a prerequisite for maximizing the productive benefits of water and are broadly in line with notions often derived from neoclassical market theory. However, in spite of the apparent faith in the market mechanism, there is a growing literature illustrating the limitations of the market framework in the context of water resource management. Accordingly, there would appear to be grounds for a more cautious approach that recognizes the potential for market failures to emerge. This article explores the present growth of water markets and the legislative background that circumscribes them in the Murray-Darling Basin. Recognizing the constraints imposed by the status quo, this study then examines the implications of stronger property rights for entitlement holders and the use of water markets in the context of the goals assigned to Australian water managers.
Description
Keywords
Keywords: Catchments; Constraint theory; Laws and legislation; Project management; Resource allocation; Rivers; Murray-Darling basin; Water markets; Water resource allocation; Water resources; resource allocation; resource management; water economics; water plannin Australian water resources; Natural resource management; Water markets
Citation
Collections
Source
Water Resources Research
Type
Journal article