Allocation trade in Australia: a qualitative understanding or irrigator motives and behaviour

Governments in Australia are purchasing water entitlements to secure water for environmental benefit, but entitlements generate an allocation profile that does not correspond fully to environmental flow requirements. Therefore, how environmental managers will operate to deliver small and medium-sized inundation environmental flows remains uncertain. To assist environmental managers with the supply of inundation flows at variable times, it has been suggested that allocation trade be incorporated into efforts aimed at securing water. This paper provides some qualitative and quantitative perspective on what influences southern Murray–Darling Basin irrigators to trade allocation water at specific times across and within seasons using a market transaction framework. The results suggest that while irrigators now have access to greater risk-management options, environmental managers should consider the possible impact of institutional change before intervening in traditional market activity. The findings may help improve the design of intervention strategies to minimise possible market intervention impacts and strategic behaviour.


Issue Date:
2012-03
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/204179
Published in:
Australian Journal of Agricultural and Resource Economics, Volume 56, Issue 1
Page range:
42-60
Total Pages:
19




 Record created 2017-04-01, last modified 2017-08-28

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