IDEAS home Printed from https://ideas.repec.org/a/ags/aareaj/161907.html
   My bibliography  Save this article

Double trouble: the importance of accounting for and defining water entitlements consistent with hydrological realities

Author

Listed:
  • Young, Michael D.
  • McColl, James C.

Abstract

When entitlements to access water in fully allocated river and aquifers are specified in a manner that is inconsistent with the ways that water arrives, flows across and flows through land, inefficient investment and water use is the result. Using Australia’s Murray Darling Basin as an example, this paper attempts to reveal the adverse economic and water management consequences of entitlement and water sharing regime misspecification in regimes that allow water trading. Markets trade water products as specified. When entitlements and the water sharing system are not designed in a way that has hydrological integrity, the market trades the water management regime into trouble. Options for specification of entitlement and allocation regimes in ways that have hydrological integrity are presented. It is reasoned, that if entitlement and allocation regime are set up in ways that have hydrological integrity, the result should be a regime that can autonomously adjust to climatic shifts, changes in prices and changes in technology without compromising environmental objectives.

Suggested Citation

  • Young, Michael D. & McColl, James C., 2009. "Double trouble: the importance of accounting for and defining water entitlements consistent with hydrological realities," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 53(1), pages 1-17.
    • Handle: RePEc:ags:aareaj:161907
    DOI: 10.22004/ag.econ.161907
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/161907/files/j.1467-8489.2007.00422.x.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.161907?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Deborah C. Peterson, 2006. "Precaution: principles and practice in Australian environmental and natural resource management ," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 50(4), pages 469-489, December.
    2. M. D. Young & J. C. McColl, 2003. "Robust Reform: The Case for a New Water Entitlement System for Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 36(2), pages 225-234, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Nordblom, Tom & Finlayson, John D. & Hume, Iain H. & Kelly, Jason A., 2009. "Supply and Demand for Water use by New Forest Plantations: a market to balance increasing upstream water use with downstream community, industry and environmental use?," Research Reports 280785, New South Wales Department of Primary Industries Research Economists.
    2. Peggy Schrobback & David Adamson & John Quiggin, 2009. "Turning Water into Carbon: Carbon sequestration vs. water flow in the Murray-Darling Basin," Murray-Darling Program Working Papers WP2M09, Risk and Sustainable Management Group, University of Queensland.
    3. John Rolfe & Brenda Dyack, 2010. "Testing for convergent validity between travel cost and contingent valuation estimates of recreation values in the Coorong, Australia ," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 54(4), pages 583-599, October.
    4. Productivity Commission, 2009. "Government Drought Support," Inquiry Reports, Productivity Commission, Government of Australia, number 46.
    5. Wheeler, Sarah & Bjornlund, Henning & Zuo, Alec & Shanahan, Martin, 2010. "The changing profile of water traders in the Goulburn-Murray Irrigation District, Australia," Agricultural Water Management, Elsevier, vol. 97(9), pages 1333-1343, September.
    6. Glyn Wittwer & Janine Dixon, 2012. "Upgrading irrigation infrastructure in the Murray Darling Basin: is it worth it?," Centre of Policy Studies/IMPACT Centre Working Papers g-228, Victoria University, Centre of Policy Studies/IMPACT Centre.
    7. Peggy Schrobback & David Adamson & John Quiggin, 2011. "Turning Water into Carbon: Carbon Sequestration and Water Flow in the Murray–Darling Basin," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 49(1), pages 23-45, May.
    8. Hatton MacDonald, Darla & Morrison, Mark D. & Rose, John M. & Boyle, Kevin J., 2011. "Valuing a multistate river: the case of the River Murray," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 55(3), pages 1-19, September.
    9. Crossman, Neville D. & Connor, Jeffrey D. & Bryan, Brett A. & Summers, David M. & Ginnivan, John, 2010. "Reconfiguring an irrigation landscape to improve provision of ecosystem services," Ecological Economics, Elsevier, vol. 69(5), pages 1031-1042, March.
    10. Garrick, Dustin & Whitten, Stuart M. & Coggan, Anthea, 2013. "Understanding the evolution and performance of water markets and allocation policy: A transaction costs analysis framework," Ecological Economics, Elsevier, vol. 88(C), pages 195-205.
    11. Nordblom, T.L. & Christy, B.P. & Finlayson, J.D. & Roberts, A.M. & Kelly, J.A., 2010. "Least cost land-use changes for targeted catchment salt load and water yield impacts in south eastern Australia," Agricultural Water Management, Elsevier, vol. 97(6), pages 811-823, June.
    12. Bryan, Brett Anthony & Crossman, Neville David, 2013. "Impact of multiple interacting financial incentives on land use change and the supply of ecosystem services," Ecosystem Services, Elsevier, vol. 4(C), pages 60-72.
    13. Tingey-Holyoak, Joanne & Pisaniello, John & Buss, Peter & Mayer, Wolfgang, 2021. "The importance of accounting-integrated information systems for realising productivity and sustainability in the agricultural sector," International Journal of Accounting Information Systems, Elsevier, vol. 41(C).
    14. Skurray, James H. & Roberts, E.J. & Pannell, David J., 2013. "Hydrological challenges to groundwater trading: lessons from south-west Western Australia," Working Papers 161073, University of Western Australia, School of Agricultural and Resource Economics.
    15. James H. Skurray & Ram Pandit & David J. Pannell, 2013. "Institutional impediments to groundwater trading: the case of the Gnangara groundwater system of Western Australia," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 56(7), pages 1046-1072, September.
    16. Young, Michael D., 2014. "Designing water abstraction regimes for an ever-changing and ever-varying future," Agricultural Water Management, Elsevier, vol. 145(C), pages 32-38.
    17. Tingey-Holyoak, Joanne Louise, 2014. "Water sharing risk in agriculture: Perceptions of farm dam management accountability in Australia," Agricultural Water Management, Elsevier, vol. 145(C), pages 123-133.
    18. Nordblom, Thomas L. & Finlayson, John D. & Hume, Iain H., 2012. "Upstream demand for water use by new tree plantations imposes externalities on downstream irrigated agriculture and wetlands," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 56(4), pages 1-20, December.
    19. 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.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Azad, Md A.S. & Ancev, Tihomir, 2010. "Using ecological indices to measure economic and environmental performance of irrigated agriculture," Ecological Economics, Elsevier, vol. 69(8), pages 1731-1739, June.
    2. John Freebairn, 2005. "Issues in the Design of Water Markets," Melbourne Institute Working Paper Series wp2005n18, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    3. Alexandros Maziotis & Elisa Calliari & Jaroslav Mysiak, 2013. "Robust Institutions for Sustainable Water Markets: A Survey of the Literature and the Way Forward," Working Papers 2013.58, Fondazione Eni Enrico Mattei.
    4. Brennan, Donna C., 2006. "Water policy reform in Australia: lessons from the Victorian seasonal water market," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 50(3), pages 1-21, September.
    5. Annette Weier & Paul Loke, 2007. "Precaution and the Precautionary Principle: two Australian case studies," Staff Working Papers 0705, Productivity Commission, Government of Australia.
    6. Brennan, Donna C., 2007. "Policy interventions to promote the adoption of water saving sprinkler systems: the case of lettuce on the Gnangara Mound," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 51(3), pages 1-19.
    7. Ward, John & Bryan, Brett & Gale, Glenn & Hobbs, Trevor, 2006. "Market-Based Instrument approaches to implementing priority revegetation in the South Australian Murray-Darling Basin," 2006 Conference (50th), February 8-10, 2006, Sydney, Australia 139924, Australian Agricultural and Resource Economics Society.
    8. Davidson, Brian, 2004. "The Problems of Analysing Markets for Irrigation Water," 2004 Conference (48th), February 11-13, 2004, Melbourne, Australia 58400, Australian Agricultural and Resource Economics Society.
    9. Baker, Rick & Ruting, Brad, 2014. "Environmental Policy Analysis: A Guide to Non‑Market Valuation," 2014 Conference (58th), February 4-7, 2014, Port Macquarie, Australia 165810, Australian Agricultural and Resource Economics Society.
    10. Peterson, Deborah C., 2006. "Precaution: principles and practice in Australian environmental and natural resource management," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 50(4), pages 1-21, December.
    11. Young, Michael D., 2014. "Designing water abstraction regimes for an ever-changing and ever-varying future," Agricultural Water Management, Elsevier, vol. 145(C), pages 32-38.
    12. Loch, Adam & Wheeler, Sarah Ann & Settre, Claire, 2018. "Private Transaction Costs of Water Trade in the Murray–Darling Basin," Ecological Economics, Elsevier, vol. 146(C), pages 560-573.
    13. Gómez-Limón, José A. & Gutiérrez-Martín, Carlos & Montilla-López, Nazaret M., 2021. "Priority water rights. Are they useful for improving water-use efficiency at the irrigation district level?," Agricultural Water Management, Elsevier, vol. 257(C).
    14. Hawke, Richard, 2006. "Improving the Water Allocation Framework in New Zealand," Occasional Papers 06/9, Ministry of Economic Development, New Zealand.
    15. Brennan, Donna C., 2008. "Missing markets for storage and the potential economic cost of expanding the spatial scope of water trade," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 54(4), pages 1-15.
    16. MacLeod, N.D. & McIvor, J.G., 2006. "Reconciling economic and ecological conflicts for sustained management of grazing lands," Ecological Economics, Elsevier, vol. 56(3), pages 386-401, March.
    17. Patterson, Murray G., 2006. "Development of ecological economics in Australia and New Zealand," Ecological Economics, Elsevier, vol. 56(3), pages 312-331, March.
    18. Young, Michael D. & McColl, James C., 2008. "Double trouble: The importance of accounting for and defining water entitlements consistent with hydrological realities (Conference title: Water Trading in the MDBC: How well is the market functioning," 2008 Conference (52nd), February 5-8, 2008, Canberra, Australia 6037, Australian Agricultural and Resource Economics Society.
    19. Holland, Dan & Schnier, Kurt E., 2006. "Individual habitat quotas for fisheries," Journal of Environmental Economics and Management, Elsevier, vol. 51(1), pages 72-92, January.
    20. Carlos Gutiérrez-Martín & José A. Gómez-Limón & Nazaret M. Montilla-López, 2022. "Priority Water Rights for Irrigation at the River Basin Level. Do They Improve Economic Efficiency During Drought Periods?," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 36(10), pages 3737-3758, August.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:aareaj:161907. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/aaresea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.