Water rights: a comparison of the impacts of urban and irrigation reforms in Australia

Abstract

Although there has been a policy thrust towards making all Australians more cognisant of the relative scarcity of water resources, the approach adopted for urban dwellers differs markedly from that applied to irrigators. These differences are examined from a property-rights perspective focussing primarily on the institutional hierarchies in the Victorian water sector. The analysis reveals significant attenuation of urban dwellers' rights, presumably on the basis of the information deficiencies that circumscribe urban water use. Alternative policy options are then proposed, which might alleviate some of these information deficiencies and simultaneously address the efficiency losses that attend the present arrangements. Copyright Australian Agricultural and Resource Economics Society Inc. and Blackwell Publishing Ltd 2006.