IDEAS home Printed from https://ideas.repec.org/a/ags/aareaj/117840.html
   My bibliography  Save this article

Water markets as a vehicle for water reform: the case of New South Wales

Author

Listed:
  • Crase, Lin
  • O'Reilly, Leo
  • Dollery, Brian

Abstract

Water reform in NSW is being undertaken using an adaptive approach in recognition of the uncertainty and imperfect knowledge embodied in the riverine environment. However, the reform process also relies, in part, on the ability of markets for tradable water entitlements to develop and thereby assist in allocating scarce water resources to their highest value use. This article explores impediments to the formation of efficient markets in permanent tradable water entitlements in NSW. The article concludes that more attention should be paid to market failures and related problems which manifest themselves in thin markets for permanent water entitlements.

Suggested Citation

  • Crase, Lin & O'Reilly, Leo & Dollery, Brian, 2000. "Water markets as a vehicle for water reform: the case of New South Wales," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 44(2), pages 1-23.
    • Handle: RePEc:ags:aareaj:117840
    DOI: 10.22004/ag.econ.117840
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/117840/files/1467-8489.00113.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.117840?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Alan Randall, 1981. "Property Entitlements And Pricing Policies For A Maturing Water Economy," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 25(3), pages 195-220, December.
    2. Howitt, Richard E., 1994. "Empirical analysis of water market institutions: The 1991 California water market," Resource and Energy Economics, Elsevier, vol. 16(4), pages 357-371, November.
    3. Robert A. Young, 1986. "Why Are There So Few Transactions among Water Users?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 68(5), pages 1143-1151.
    4. Thobani, Mateen, 1997. "Formal Water Markets: Why, When, and How to Introduce Tradable Water Rights," The World Bank Research Observer, World Bank, vol. 12(2), pages 161-179, August.
    5. Challen, Ray & Petch, Anthony, 1997. "Price Determination and Behaviour in the Market for Irrigation Water in South Australia," 1997 Conference (41st), January 22-24, 1997, Gold Coast, Australia 135740, Australian Agricultural and Resource Economics Society.
    6. Alaouze, C.M. & Whelan, S.P., 1996. "Economic Efficiency and Property Rights Issues in the Management of Rural Water," Papers 96/6, New South Wales - School of Economics.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ann Vourc'h & Robert Price, 2001. "Encouraging Environmentally Sustainable Growth in Australia," OECD Economics Department Working Papers 309, OECD Publishing.
    2. Edwyna Harris, 2011. "The Impact of Institutional Path Dependence on Water Market Efficiency in Victoria, Australia," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 25(15), pages 4069-4080, December.
    3. John Freebairn & John Quiggin, 2006. "Water rights for variable supplies ," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 50(3), pages 295-312, September.
    4. Skurray, James H., 2015. "The scope for collective action in a large groundwater basin: An institutional analysis of aquifer governance in Western Australia," Ecological Economics, Elsevier, vol. 114(C), pages 128-140.
    5. Rajendra Poddar & M. Qureshi & Tian Shi, 2014. "A Comparison of Water Policies for Sustainable Irrigation Management: The Case of India and Australia," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 28(4), pages 1079-1094, March.
    6. Simon de Bonviller & Alec Zuo & Sarah Ann Wheeler, 2019. "Is there evidence of insider trading in Australian water markets?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 63(2), pages 307-327, April.
    7. Quiggin, John C., 2001. "Environmental economics and the Murray-Darling river system," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 45(1), pages 1-28.
    8. Lee, Lisa Y. & Ancev, Tihomir & Vervoort, Willem, 2012. "Evaluation of environmental policies targeting irrigated agriculture: The case of the Mooki catchment, Australia," Agricultural Water Management, Elsevier, vol. 109(C), pages 107-116.
    9. Jayanath Ananda & Nicholas Pawsey & Tahmid Nayeem, 2022. "Customer‐centric regulation: The case of Victorian urban water sector," Regulation & Governance, John Wiley & Sons, vol. 16(2), pages 536-556, April.
    10. Gaydon, D.S. & Meinke, H. & Rodriguez, D. & McGrath, D.J., 2012. "Comparing water options for irrigation farmers using Modern Portfolio Theory," Agricultural Water Management, Elsevier, vol. 115(C), pages 1-9.
    11. Jeff Bennett, 2005. "Australasian environmental economics: contributions, conflicts and ‘cop‐outs’," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 49(3), pages 243-261, September.
    12. Hawke, Richard, 2006. "Improving the Water Allocation Framework in New Zealand," Occasional Papers 06/9, Ministry of Economic Development, New Zealand.
    13. Crase, Lin & Dollery, Brian & Lockwood, Michael, 2001. "Towards an Understanding of Static Transaction Costs in the NSW Permanent Water Market: An Application of Choice Modelling," 2001 Conference (45th), January 23-25, 2001, Adelaide, Australia 125588, Australian Agricultural and Resource Economics Society.
    14. Craig D. Broadbent & David S. Brookshire & Don Coursey & Vince Tidwell, 2017. "Futures Contracts in Water Leasing: An Experimental Analysis Using Basin Characteristics of the Rio Grande, NM," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 68(3), pages 569-594, November.
    15. Skurray, James H., 2013. "The scope for collective action in a large groundwater basin: an institutional analysis of aquifer governance in Western Australia," Working Papers 161075, University of Western Australia, School of Agricultural and Resource Economics.
    16. Brooks, Robert & Harris, Edwyna, 2008. "Efficiency gains from water markets: Empirical analysis of Watermove in Australia," Agricultural Water Management, Elsevier, vol. 95(4), pages 391-399, April.
    17. Broadbent, Craig D. & Brookshire, David S. & Coursey, Don & Tidwell, Vince, 2014. "An experimental analysis of water leasing markets focusing on the agricultural sector," Agricultural Water Management, Elsevier, vol. 142(C), pages 88-98.
    18. Shi, Tian, 2006. "Simplifying complexity: Rationalising water entitlements in the Southern Connected River Murray System, Australia," Agricultural Water Management, Elsevier, vol. 86(3), pages 229-239, December.
    19. Crase, Lin & Dollery, Brian & Lockwood, Michael, 2002. "Transaction Costs and Welfare in the Permanent Water Market in NSW," 2002 Conference (46th), February 13-15, 2002, Canberra, Australia 125076, Australian Agricultural and Resource Economics Society.
    20. Davidson, Brian, 2004. "The Problems of Analysing Markets for Irrigation Water," 2004 Conference (48th), February 11-13, 2004, Melbourne, Australia 58400, Australian Agricultural and Resource Economics Society.
    21. Bjornlund, Henning, 2003. "Farmer participation in markets for temporary and permanent water in southeastern Australia," Agricultural Water Management, Elsevier, vol. 63(1), pages 57-76, November.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Deng, Xiaohong & Xu, Zhongmin & Song, Xiaoyu & Zhou, Jian, 2017. "Transaction costs associated with agricultural water trading in the Heihe River Basin, Northwest China," Agricultural Water Management, Elsevier, vol. 186(C), pages 29-39.
    2. Crase, Lin & Dollery, Brian & Lockwood, Michael, 2001. "Towards an Understanding of Static Transaction Costs in the NSW Permanent Water Market: An Application of Choice Modelling," 2001 Conference (45th), January 23-25, 2001, Adelaide, Australia 125588, Australian Agricultural and Resource Economics Society.
    3. Brennan, Donna C. & Scoccimarro, Michelle, 1999. "Issues in defining property rights to improve Australian water markets," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 43(1), pages 1-21, March.
    4. Molden, David & Sakthivadivel, Ramasamy & Samad, Madar & Burton, Martin, 2005. "Phases of river basin development: the need for adaptive institutions," Book Chapters,, International Water Management Institute.
    5. Hansen, Kristiana, 2010. "Water Markets and Water Rights Markets in the Western United States," Western Economics Forum, Western Agricultural Economics Association, vol. 9(2), pages 1-10.
    6. Zhang, Junlian, 2007. "Barriers to water markets in the Heihe River basin in northwest China," Agricultural Water Management, Elsevier, vol. 87(1), pages 32-40, January.
    7. José A. Gómez-Limón & Yolanda Martínez Martínez, 2004. "Multicriteria Modelling of Irrigation Water Market at Basin Level," Economic Working Papers at Centro de Estudios Andaluces E2004/26, Centro de Estudios Andaluces.
    8. Ellen Hanak, 2005. "Stopping the Drain: Third‐party Responses to California's Water Market," Contemporary Economic Policy, Western Economic Association International, vol. 23(1), pages 59-77, January.
    9. James E. Nickum & K. William Easter, 1990. "Institutional arrangements for managing water conflicts in lake basins," Natural Resources Forum, Blackwell Publishing, vol. 14(3), pages 210-221, August.
    10. Wester, P. & Scott, Christopher A. & Burton, Martin, 2005. "River basin closure and institutional change in Mexico’s Lerma-Chapala Basin," Book Chapters,, International Water Management Institute.
    11. Jonathan Yoder & Micheal Brady & Joseph Cook, 2016. "Water Markets and Storage — Substitutes or Complements for Drought Risk Mitigation?," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 2(02), pages 1-21, June.
    12. Williamson, Brendon & Villano, Renato A. & Fleming, Euan M., 2008. "Structuring Exotic Options Contracts on Water to Improve the Efficiency of Resource Allocation in the Water Spot Market," 2008 Conference (52nd), February 5-8, 2008, Canberra, Australia 5992, Australian Agricultural and Resource Economics Society.
    13. Georgina W. Njiraini & Djiby Racine Thiam & Anthea Coggan, 2017. "The Analysis of Transaction Costs in Water Policy Implementation in South Africa: Trends, Determinants and Economic Implications," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 3(01), pages 1-30, January.
    14. Svendsen, Mark & Wester, Philippus & Molle, Francois, 2005. "Managing river basins: an institutional perspective," Book Chapters,, International Water Management Institute.
    15. Mani Rouhi Rad & Taro Mieno & Nicholas Brozović, 2022. "The Role of Search Frictions and Trading Ratios in Tradable Permit Markets," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 82(1), pages 101-132, May.
    16. Zegarra Méndez, Eduardo, 2004. "The market and water management reform in Peru," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), August.
    17. Gomez-Limon, Jose A. & Martinez, Yolanda, 2006. "Multi-criteria modelling of irrigation water market at basin level: A Spanish case study," European Journal of Operational Research, Elsevier, vol. 173(1), pages 313-336, August.
    18. Garrick, Dustin & Whitten, Stuart M. & Coggan, Anthea, 2013. "Understanding the evolution and performance of water markets and allocation policy: A transaction costs analysis framework," Ecological Economics, Elsevier, vol. 88(C), pages 195-205.
    19. Svendsen, Mark (ed.), 2005. "Irrigation and river basin management: options for governance and institutions," IWMI Books, International Water Management Institute, number 138050.
    20. Mark T. Kanazawa, 2019. "Transaction Costs in Water Transfers: The issue of local control," Working Papers 2019-01, Carleton College, Department of Economics.

    More about this item

    Keywords

    Resource /Energy Economics and Policy;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:aareaj:117840. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/aaresea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.