A tale of two water markets in Australia: lessons for understanding participation in formal water markets

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dc.contributor.authorWheeler, S.A.
dc.contributor.authorGarrick, D.E.
dc.date.issued2020
dc.description.abstractWater markets are promoted as a demand-management strategy for addressing water scarcity. Although there is an increasing literature on the institutional preconditions required for successful formal water markets, there has been less focus on understanding what drives participation after establishment of the basic enabling conditions. Participation can be measured in terms of either trading activity (conducting either a permanent or temporary water trade) and/or trade volumes across time and market products. Australia’s water markets in the Southern and Northern Basins of the Murray-Darling Basin provide a notable example of a ‘tale of two water markets’, offering insights about the economic policy levers that can drive participation across different hydrological, irrigation, and socioeconomic contexts. Key lessons include: distribution of initial property rights in resource allocation; the need to prepare for and seize opportunities to strengthen property rights; and robust monitoring and compliance requirements—all of which will reduce transaction costs and increase participation.
dc.description.statementofresponsibilitySarah Ann Wheeler and Dustin E. Garrick
dc.identifier.citationOxford Review of Economic Policy, 2020; 36(1):132-153
dc.identifier.doi10.1093/oxrep/grz032
dc.identifier.issn0266-903X
dc.identifier.issn1460-2121
dc.identifier.orcidWheeler, S.A. [0000-0002-6073-3172]
dc.identifier.urihttp://hdl.handle.net/2440/123347
dc.language.isoen
dc.publisherOxford University Press
dc.relation.granthttp://purl.org/au-research/grants/arc/FT140100773
dc.rights© The Author(s) 2020. Published by Oxford University Press. For permissions please e-mail: journals.permissions@oup.com
dc.source.urihttps://doi.org/10.1093/oxrep/grz032
dc.subjectWater markets; Murray-Darling Basin; property rights; transaction costs
dc.titleA tale of two water markets in Australia: lessons for understanding participation in formal water markets
dc.typeJournal article
pubs.publication-statusPublished

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