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Effective use of public funding in the Murray-Darling Basin: a comparison of buybacks and infrastructure upgrades

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  • Glyn Wittwer
  • Janine Dixon

Abstract

Policy instruments designed to increase environmental flows in the Murray–Darling Basin are compared using TERM-H2O, a detailed, dynamic regional CGE model. Voluntary and fully compensated buybacks are much less costly than infrastructure upgrades as a means of obtaining a target volume of environmental water, even during drought, when highly secure water created by infrastructure upgrades is more valuable. As an instrument of regional economic management, infrastructure upgrades are inferior to public spending on health, education and other services in the Basin. For each job created from upgrades, the money spent on services could create between three and four jobs in the Basin.
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Suggested Citation

  • Glyn Wittwer & Janine Dixon, 2013. "Effective use of public funding in the Murray-Darling Basin: a comparison of buybacks and infrastructure upgrades," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 57(3), pages 399-421, July.
    • Handle: RePEc:bla:ajarec:v:57:y:2013:i:3:p:399-421
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    File URL: http://hdl.handle.net/10.1111/1467-8489.12001
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    Cited by:

    1. Adamson, David & Loch, Adam, 2018. "Achieving environmental flows where buyback is constrained," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 62(1), January.
    2. Neal Hughes & Manannan Donoghoe & Linden Whittle, 2020. "Farm Level Effects of On‐Farm Irrigation Infrastructure Programs in the Southern Murray–Darling Basin," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 53(4), pages 494-516, December.
    3. Mai, Thanh & Mushtaq, Shahbaz & Loch, Adam & Reardon-Smith, K. & An-Vo, Duc-Anh, 2019. "A systems thinking approach to water trade: Finding leverage for sustainable development," Land Use Policy, Elsevier, vol. 82(C), pages 595-608.
    4. Wittwer, Glyn, 2021. "A review of CGE modelling of irrigation developments and policies in Australia," Conference papers 333263, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    5. Glyn Wittwer, 2022. "Preparing a multi-country, sub-national CGE model: EuroTERM including Ukraine," Centre of Policy Studies/IMPACT Centre Working Papers g-334, Victoria University, Centre of Policy Studies/IMPACT Centre.
    6. Sarah Ann Wheeler & Alec Zuo, 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), pages 404-421, July.
    7. 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.
    8. Sarah Ann Wheeler & Ying Xu & Alec Zuo, 2020. "Modelling the climate, water and socio-economic drivers of farmer exit in the Murray-Darling Basin," Climatic Change, Springer, vol. 158(3), pages 551-574, February.
    9. Wheeler, Sarah Ann & Zuo, Alec & Loch, Adam, 2015. "Watering the farm: Comparing organic and conventional irrigation water use in the Murray–Darling Basin, Australia," Ecological Economics, Elsevier, vol. 112(C), pages 78-85.
    10. Claire Settre & Jeff Connor & Sarah Ann Wheeler, 2017. "Reviewing the Treatment of Uncertainty in Hydro-economic Modeling of the Murray–Darling Basin, Australia," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 3(03), pages 1-35, July.
    11. Wittwer, Glyn, 2020. "The Murray Darling Basin Plan amid Drought and Civil Discontent," Conference papers 333230, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    12. Glyn Wittwer & Michael D Young, 2020. "Distinguishing Between Policy, Drought and International Events in the Context of the Murray Darling Basin Plan," Centre of Policy Studies/IMPACT Centre Working Papers g-295, Victoria University, Centre of Policy Studies/IMPACT Centre.
    13. Alec Zuo & Sarah Ann Wheeler & Peter Boxall & W. L. (Vic) Adamowicz & Darla Hatton MacDonald, 2015. "Identifying Water Prices at which Australian Farmers Will Exit Irrigation: Results of a Stated Preference Survey," The Economic Record, The Economic Society of Australia, vol. 91(S1), pages 109-123, June.

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