Fundamental questions about water rights and market reallocation

Abstract

[1] Water markets have many advantages for water reallocation. However, water markets do not always function efficiently because the property rights structure was not designed for market transactions. The potential for successful markets can be determined by looking at the 10 fundamental questions relevant to water rights. The questions are relevant to any system of water rights, but the examples used are largely from the western United States. The questions are designed to raise issues about the basic structure of a water rights system. After discussing these issues, the paper turns to recommendations on how a water rights structure could be modified to facilitate markets. The recommendations are not meant to be an end point but are intended too stimulate discussion.

Pricing China's irrigation water

“…There, systems of transferable water rights have improved the efficiency of water use, but are new and remain imperfect (Dinar and Mody, 2004;Matthews, 2004;Pigram, 1999;Smith, 1998) and have to be very carefully tailored to local institutional and environmental conditions (Haddad, 2000b). Yet, even if this policy instrument works in some countries, it will not necessarily work in China: externally driven solutions to water problems in developing countries tend to correct the least relevant problems in the least practical way (Biswas, 2001;Pigram, 1999).…”

Robust Institutions for Sustainable Water Markets: A Survey of the Literature and the Way Forward

“…However, Matthews (2004) argues that water markets do not function efficiently as water property rights were not designed for market transactions. The author raises several issues regarding the structure of a water right system driven by the experience in the western United States.…”

Research on Optimal Water Allocation Based on Water Rights Trade under the Principle of Water Demand Management: A Case Study in Bayannur City, China

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