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How to Increase the Cost-effectiveness of Water Reform and Environmental Flows in the Murray-Darling Basin

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  • R. Quentin Grafton

Abstract

The paper reviews the $12.9 billion Water for the Future package in the Murray- Darling Basin from the perspective of cost-effectiveness and assesses the possible losses to irrigators from reduced diversions to achieve desired environmental- flow regimes. It argues that combining the $3.1 billion allocated to buying water entitlements with the $5.8 billion targeted by Water for the Future for water infrastructure subsidies into a purchase of water entitlements from willing sellers would maximise the water acquired for the environment per dollar of expenditure, provide greater assistance to holders of water entitlements, and reduce the expected gap between average water diversions for agriculture and sustainable diversion limits.

Suggested Citation

  • R. Quentin Grafton, 2010. "How to Increase the Cost-effectiveness of Water Reform and Environmental Flows in the Murray-Darling Basin," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 17(2), pages 17-40.
    • Handle: RePEc:acb:agenda:v:17:y:2010:i:2:p:17-40
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    File URL: http://press-files.anu.edu.au/downloads/press/p89361/pdf/murray_darling.pdf
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    References listed on IDEAS

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    1. Daniel Connell, 2010. "Sustainability and the National Water Initiative," Centre for Water Economics, Environment and Policy Papers 1006, Centre for Water Economics, Environment and Policy, Crawford School of Public Policy, The Australian National University.
    2. Lisa Yu-Ting Lee & Tihomir Ancev, 2009. "Two Decades of Murray-Darling Water Management: A River of Funding, a Trickle of Achievement," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 16(1), pages 5-24.
    3. R. Quentin Grafton & Qiang Jiang, 2010. "Economics of Drought, Water Diversions, Water Recovery and Climate Change in the Murray‐Darling Basin," Centre for Water Economics, Environment and Policy Papers 1001, Centre for Water Economics, Environment and Policy, Crawford School of Public Policy, The Australian National University.
    4. R. Quentin Grafton, 2010. "Economics of Water Reform in the Murray-Darling Basin," Centre for Water Economics, Environment and Policy Papers 1004, Centre for Water Economics, Environment and Policy, Crawford School of Public Policy, The Australian National University.
    5. Mark Eigenraam & Loris Strappazzon & Nicola Lansdell & Craig Beverly & Gary Stoneham, 2007. "Designing frameworks to deliver unknown information to support market‐based instruments," Agricultural Economics, International Association of Agricultural Economists, vol. 37(s1), pages 261-269, December.
    6. Qiang Jiang, 2010. "An overview of the Integrated Irrigated Agriculture Water Model (IIAWM) of the Murray Darling Basin," Centre for Water Economics, Environment and Policy Papers 1003, Centre for Water Economics, Environment and Policy, Crawford School of Public Policy, The Australian National University.
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    Cited by:

    1. R. Quentin Grafton, 2017. "Editorial — Water Reform and Planning in the Murray–Darling Basin, Australia," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 3(03), pages 1-18, July.
    2. Marshall, Graham R., 2013. "Transaction Costs, Collective Action And Adaptation In Managing Social-Ecological Systems," 2013 Conference (57th), February 5-8, 2013, Sydney, Australia 152166, Australian Agricultural and Resource Economics Society.
    3. Wheeler, Sarah Ann & Zuo, Alec, 2017. "The impact of drought and water scarcity on irrigator farm exit intentions in the Murray– Darling Basin," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 61(3), July.
    4. Rupert Quentin Grafton & Qiang Jiang, 2011. "Economic effects of water recovery on irrigated agriculture in the Murray‐Darling Basin," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 55(4), pages 487-499, October.
    5. Graham R. Marshall, 2020. "Evaluating Adaptive Efficiency in Environmental Water Recovery: Application of a Framework for Institutional Cost-Effectiveness Analysis," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 6(02), pages 1-28, April.
    6. R. Quentin Grafton & James Horne & Sarah Ann Wheeler, 2016. "On the Marketisation of Water: Evidence from the Murray-Darling Basin, Australia," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(3), pages 913-926, February.
    7. Rakesh Gupta & Kejia Yan & Tarlok Singh & Di Mo, 2020. "Domestic and International Drivers of the Demand for Water Resources in the Context of Water Scarcity: A Cross-Country Study," JRFM, MDPI, vol. 13(11), pages 1-28, October.

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