IDEAS home Printed from https://ideas.repec.org/p/ags/aare11/100560.html
   My bibliography  Save this paper

Corner solutions in the allocation of environmental water: an application of inframarginal economics

Author

Listed:
  • Hone, Simon

Abstract

Inframarginal economics is a combination of marginal and total cost-benefit analysis (across corner solutions). It has been applied extensively in analysing trade issues, however, there have been few environmental applications. While there is debate over the contribution of inframarginal economics to the analysis of aggregate economic phenomena, inframarginal economics is central to understanding agent-level decisions. This paper applies inframarginal methods to investigate the efficient allocation of water among ecosystems. The Australian Government is acquiring billions of dollars of water for environmental uses through a number of programs. Allocating this water efficiently will require information on preferences and environmental production functions, as well as the development of analytical frameworks capable of examining corner solutions. Within a general inframarginal framework, this paper investigates the conditions under which corner solutions are likely to be efficient. In particular, corner solutions may arise when environmental production functions are convex but are also possible under ‘well behaved’ functions.

Suggested Citation

  • Hone, Simon, 2011. "Corner solutions in the allocation of environmental water: an application of inframarginal economics," 2011 Conference (55th), February 8-11, 2011, Melbourne, Australia 100560, Australian Agricultural and Resource Economics Society.
    • Handle: RePEc:ags:aare11:100560
    DOI: 10.22004/ag.econ.100560
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/100560/files/Hone%20S.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.100560?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
    ---><---

    References listed on IDEAS

    as
    1. Commission, Productivity, 2010. "Market Mechanisms for Recovering Water in the Murray-Darling Basin," Research Reports, Productivity Commission, Government of Australia, number 40.
    Full references (including those not matched with items on IDEAS)

    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. Edwards, Geoff W., 2012. "The Desalination Plant, The North-South Pipeline And The Welfare Of Melburnians," 2012 Conference (56th), February 7-10, 2012, Fremantle, Australia 124292, Australian Agricultural and Resource Economics Society.
    2. Onil Banerjee, 2015. "Investing in recovering water for the environment in Australia's Murray-Darling Basin," International Journal of Water Resources Development, Taylor & Francis Journals, vol. 31(4), pages 701-717, December.
    3. Horne, Avril & Freebairn, John W. & O'Donnell, Erin, 2011. "Establishing and managing the environmental water reserve – the interaction between different government policies," 2011 Conference (55th), February 8-11, 2011, Melbourne, Australia 100561, Australian Agricultural and Resource Economics Society.
    4. Lin Crase & Nicholas Pawsey & Sue O'Keefe, 2013. "A Note on Contradictions in Australian Water Policy," Economic Papers, The Economic Society of Australia, vol. 32(3), pages 353-359, September.
    5. Grafton, R. Quentin & Horne, James, 2014. "Water markets in the Murray-Darling Basin," Agricultural Water Management, Elsevier, vol. 145(C), pages 61-71.
    6. Grafton, Rupert & Jiang, Qiang, 2011. "Economic effects of water recovery on irrigated agriculture in the Murray-Darling Basin," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 55(4), pages 1-13.
    7. Peter B. Dixon & Maureen T. Rimmer & Glyn Wittwer, 2011. "Saving the Southern Murray‐Darling Basin: The Economic Effects of a Buyback of Irrigation Water," The Economic Record, The Economic Society of Australia, vol. 87(276), pages 153-168, March.
    8. Marshall, Graham R., 2013. "Transaction Costs, Collective Action And Adaptation In Managing Social-Ecological Systems," 2013 Conference (57th), February 5-8, 2013, Sydney, Australia 152166, Australian Agricultural and Resource Economics Society.
    9. 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.
    10. R. Quentin Grafton & James Horne & Sarah Ann Wheeler, 2016. "On the Marketisation of Water: Evidence from the Murray-Darling Basin, Australia," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(3), pages 913-926, February.
    11. R. Quentin Grafton & Gary D. Libecap & Eric C. Edwards & R. J. O’Brien & Clay Landry, 2010. "Water Scarcity and Water Markets: A Comparison of Institutions and Practices in the Murray-Darling Basin of Australia and the Western US," ICER Working Papers 28-2010, ICER - International Centre for Economic Research.
    12. R. Quentin Grafton & Gary D. Libecap & Eric C. Edwards & R. J. (Bob) O'Brien & Clay Landry, 2011. "A Comparative Assessment of Water Markets: Insights from the Murray-Darling Basin of Australia and the Western US," ICER Working Papers 08-2011, ICER - International Centre for Economic Research.
    13. Graham R. Marshall, 2020. "Evaluating Adaptive Efficiency in Environmental Water Recovery: Application of a Framework for Institutional Cost-Effectiveness Analysis," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 6(02), pages 1-28, April.
    14. Lin Crase & Bethany Cooper, 2017. "The Political Economy of Drought: Legacy and Lessons from Australia's Millennium Drought," Economic Papers, The Economic Society of Australia, vol. 36(3), pages 289-299, September.
    15. Truong, Chi H. & Drynan, Ross G., 2013. "Capacity sharing enhances efficiency in water markets involving storage," Agricultural Water Management, Elsevier, vol. 122(C), pages 46-52.
    16. Lin Crase, 2017. "Policy Nook: "When Scarcity Ends, Policy Reform Loses Steam: Comments on Australian Water Reform and Political Backsliding"," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 3(03), pages 1-8, July.
    17. James Horne, 2014. "The 2012 Murray-Darling Basin Plan - issues to watch," International Journal of Water Resources Development, Taylor & Francis Journals, vol. 30(1), pages 152-163, March.
    18. Steve Easton & Sean Pinder, 2022. "Measuring the price of Australian water," Australian Journal of Management, Australian School of Business, vol. 47(1), pages 24-33, February.

    More about this item

    Keywords

    Environmental Economics and Policy;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    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:aare11:100560. 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.