Irrigation externalities: pricing and charges
AbstractThe Productivity Commission Staff Working Paper ‘Irrigation externalities: pricing and charges. by Gavan Dwyer, Robert Douglas, Deb Peterson, Jo Chong and Kate Maddern was released on 14 March 2006. The paper discusses the nature and causes of environmental change related to rural water use, and provides a taxonomy of the many diverse types. It also examines the issues surrounding possible charges on water use for water related externalities. There have been few attempts by water utilities to incorporate externalities into full cost pricing of irrigation water. The aim of this Staff Working Paper was to: examine the extent to which charges imposed by irrigation water utilities could address externalities from irrigation water supply and use; and to develop a framework to identify and characterise changes in environmental conditions from the supply and use of irrigation water that may lead to environmental externalities. The authors found that many factors influence the extent to which charging for water would change water use. These include the volume of water available to irrigators, the extent to which trade can occur, the size of the charge or tax, the price responsiveness for irrigation water and the existing mechanisms to address externalities. A tax on water use may increase economic efficiency where external costs are related only to the level of water use. However, such a tax is an unsuitable instrument if the Government’s policy objective is to reduce environmental damage to a predetermined level or to raise a target level of revenue to address the externalities. The views expressed in this paper are those of the staff involved and do not necessarily reflect those of the Productivity Commission.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Productivity Commission, Government of Australia in its series Staff Working Papers with number 0603.
Length: 83 pages.
Date of creation: Mar 2006
Date of revision:
Publication status: Published by the Productivity Commission, Australia.
irrigation externalities; water charges; water trading;
Find related papers by JEL classification:
- Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics
- R - Urban, Rural, Regional, Real Estate, and Transportation Economics
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- M. L. Weitzman, 1973.
"Prices vs. Quantities,"
106, Massachusetts Institute of Technology (MIT), Department of Economics.
- Bazin, D. & Ballet, J. & Touahri, D., 2004. "Environmental responsibility versus taxation," Ecological Economics, Elsevier, vol. 49(2), pages 129-134, June.
- Mike Young, 2000. "Draft Guidelines for Managing Externalities: Restoring the balance," Natural Resource Management Economics 00_005, Policy and Economic Research Unit, CSIRO Land and Water, Adelaide, Australia.
- Don Fullerton & Gilbert Metcalf, 1997.
"Environmental Controls, Scarcity Rents, and Pre-Existing Distortions,"
NBER Working Papers
6091, National Bureau of Economic Research, Inc.
- Fullerton, Don & Metcalf, Gilbert E., 2001. "Environmental controls, scarcity rents, and pre-existing distortions," Journal of Public Economics, Elsevier, vol. 80(2), pages 249-267, May.
- Don Fullerton & Gilbert E. Metcalf, 1997. "Environmental Controls, Scarcity Rents, and Pre-Existing Distortions," Discussion Papers Series, Department of Economics, Tufts University 9703, Department of Economics, Tufts University.
- Ribaudo, Marc & Horan, Richard D. & Smith, Mark E., 1999. "Economics of Water Quality Protection from Nonpoint Sources: Theory and Practice," Agricultural Economics Reports 33913, United States Department of Agriculture, Economic Research Service.
- Peterson, Deborah C. & Dwyer, Gavan & Appels, David & Fry, Jane, 2004.
"Modelling Water Trade in the Southern Murray-Darling Basin,"
Staff Working Papers
31925, Productivity Commission.
- D. Peterson & G. Dwyer & D. Appels & J. Fry, 2005. "Modelling Water Trade in the Southern Murray-Darling Basin," Urban/Regional 0506007, EconWPA.
- Stefan Hajkowicz (Ed) & Mike Young (Ed), 2002. "Value of Returns to Land and Water and Costs of Degradation Vol 1 of 2," Natural Resource Management Economics 02_002, Policy and Economic Research Unit, CSIRO Land and Water, Adelaide, Australia.
- D. Appels & R. Douglas & G. Dwyer, 2005.
"Responsiveness of Demand for Irrigation Water: A Focus on the Southern Murray-Darling Basin,"
- Appels, David & Douglas, Robert A. & Dwyer, Gavan, 2004. "Responsiveness of Demand for Irrigation Water: A Focus on the Southern Murray-Darling Basin," Staff Working Papers 31924, Productivity Commission.
- Aretino, Barbara & Holland, Paula & Matysek, Anna & Peterson, Deborah C., 2001. "Cost Sharing for Biodiversity Conservation: A Conceptual Framework," Staff Research Papers 31915, Productivity Commission.
- Mike Young, 2002. "A preliminary Assessment of the economic and social implications of Environmental Flow Scenarios for the Murray River System," Natural Resource Management Economics 02_009, Policy and Economic Research Unit, CSIRO Land and Water, Adelaide, Australia.
- Bjornlund, Henning, 2003. "Farmer participation in markets for temporary and permanent water in southeastern Australia," Agricultural Water Management, Elsevier, vol. 63(1), pages 57-76, November.
- Anonymous, 2006. "Rural Water Use and the Environment: The Role of Market Mechanisms," Commissioned Studies 8020, Productivity Commission.
- Adar, Zvi & Griffin, James M., 1976. "Uncertainty and the choice of pollution control instruments," Journal of Environmental Economics and Management, Elsevier, vol. 3(3), pages 178-188, October.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (MAPS).
If references are entirely missing, you can add them using this form.