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Market-based instruments for water allocation in India: issues and the way forward

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  • Venkatachalam, L.
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    Abstract

    Institutions do matter in managing water scarcity. Institutional reforms in water sector in recent years have tried to replace the existing ‘command-and-control approach’ with more innovative and comprehensive marketbased approach. Based on a comprehensive literature review, this paper highlights various issues involved in marketbased institutional reforms in the water sector in various countries. This paper finds that even though there are some problems, the market-based institutional reforms are capable of generating relatively higher benefits through efficient, equitable and sustainable water allocation mechanisms. This paper also provides policy suggestions on introducing market-based instruments formally in the water sector in the Indian context.Length: pp.498-512

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    Bibliographic Info

    Paper provided by International Water Management Institute in its series Conference Papers with number h042916.

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    Date of creation: 2008
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    Handle: RePEc:iwt:conppr:h042916

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    Keywords: Water allocation;

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    1. Coase, R H, 1992. "The Institutional Structure of Production," American Economic Review, American Economic Association, vol. 82(4), pages 713-19, September.
    2. Oliver E. Williamson, 2000. "The New Institutional Economics: Taking Stock, Looking Ahead," Journal of Economic Literature, American Economic Association, vol. 38(3), pages 595-613, September.
    3. Thobani, Mateen, 1997. "Formal Water Markets: Why, When, and How to Introduce Tradable Water Rights," World Bank Research Observer, World Bank Group, vol. 12(2), pages 161-79, August.
    4. Geoffrey M. Hodgson, 1998. "The Approach of Institutional Economics," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 166-192, March.
    5. R. Maria Saleth & Ariel Dinar, 2004. "The Institutional Economics of Water : A Cross-Country Analysis of Institutions and Performance," World Bank Publications, The World Bank, number 14884, October.
    6. John Conlisk, 1996. "Why Bounded Rationality?," Journal of Economic Literature, American Economic Association, vol. 34(2), pages 669-700, June.
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