Policy Domains in Water Management: Assessing the Influence of Finance in Environmental Governance

Abstract

This article examines how public officials in the field of water supply governance navigate overlapping policy domains. Drawing lessons from Daly’s critique of the dominant economic paradigm of our time, this study focuses on the intractable tension between growth and dwindling environmental resources. Using data from interviews and participant observations, I seek to understand the work of environmental governance officials in a region that seems to be firmly committed to pro-growth policy regimes, despite increasing stress on water supplies. I identify five policy domains as analytic categories to study the various events and actions in water governance. The domains are Political, Financial, Technological, Environmental, and Developmental. The analysis suggests that regulatory compliance and finance-oriented objectives are central drivers that shape water management. The data show that aside from times of legal compulsion—that is, regulatory compliance—financial considerations tend to take precedence, as other matters are filtered through a lens of financial costs and benefits. Building on previous research, I suggest that the centrality of financial aims in this setting is consistent with the financialization of society in general. Consequently, we can expect the presence of positive and negative financial feedbacks rooted in the funding structures of contemporary urban governance. These contribute to advantages for municipalities with wealthier tax bases and systematic marginalization of places with less economic resources. In closing, I suggest that the negative financial feedback can be conceptualized as the financial pathology of institutions, and I underscore promising avenues for lasting and socially equitable environmental reform.