Files
Abstract
The theoretical foundation of water market reforms presumes that such institutions
will allow water to be traded from relatively low-value to higher-value uses and
simultaneously accomplish many of the economic and environmental objectives
ascribed to water resource managers. Numerous ex ante analyses have been
conducted to model the impacts of entitlement markets, allocations for the
environment and other recent legislative changes pertaining to water (see, for
instance, Hall, Poulter and Curtotti 1993; Crean et al. 1998). In general, these
analyses support the market framework as a technique for allocating water as it
becomes increasingly scarce. However, a relative dearth of information exists about
the impact of legislative change itself on the citizenry who are required to assimilate
and conform to the changing rules within a market setting. This paper explores the
impact of the resulting attenuation of property rights on the behaviour of potential
buyers and sellers of water in the market for permanent water transfers in NSW. The
paper uses a Choice Modelling approach to enumerate the value of a more stable set
of property rights.