Posts

Special issue of Ecological Economics examines water allocation policy and transaction costs

Dr. Dustin Garrick (School of Geography and the Environment, Oxford Martin School), co-edited a special issue of Ecological Economics on transaction costs and environmental policy, featuring papers on water, carbon, biodiversity and land use issues. Three papers examine water allocation reforms and deliver insights about institutional responses to water allocation tradeoffs.

 

Transaction costs are comparably high for water allocation challenges because property rights are complex and contested. By clarifying conceptual issues and taking stock of empirical evidence and methodological innovations, this collection of papers stimulates more attention to transaction costs in environmental policy design and evaluation and provides recommendations to improve policy choices.

In a comparative study of water markets in the US and Australia, Garrick and colleagues highlight the need for flexibility to adjust water rights and diversion limits in response to policy learning. The study illustrates how the measurement and evaluation of transaction costs can encourage policy choices that improve water market performance and build capacity to adapt to climatic variability and competition.

Visit the special issue Transaction Costs and Environmental Policy online

Economic Rights and Regulatory Regimes: is there still a ‘right’ to water?

On Tuesday 19 March, a workshop at Oxford University gathered 55 participants from the Department for the Environment, Food and Rural Affairs (Defra), the Environment Agency, the National Farmers’ Union, water companies, along with academic experts to discuss the right to water in the light of increasing regulatory intervention.

 

The event was convened by Dr. Bettina Lange, Centre for Socio-Legal Studies, Oxford University and Dr. Mark Shepheard, McGill University, in association with the Foundation of Law, Justice and Society and Wolfson College.

The workshop’s theme was inspired by increasing concerns about water scarcity issues in the face of pressures from climate change and reforms to the abstraction licensing system currently being discussed for England and Wales.

The first panel, which invited speakers to ‘rethink’ water rights through stewardship, was opened by Professor Karen Morrow from Swansea University who provided an extensive overview of the common law applicable to water regulation. Morrow highlighted the links that water regulation has not only with property law but also with administrative environmental and human rights law. She introduced the new and more radical approach of granting rights to nature to protect water resources. Dr. Bettina Lange and Dr. Mark Shepheard shared their findings from empirical socio-legal research which mapped how farmers think about a right to water and identified key factors that shape such conceptions.

Henry Leveson-Gower, Head of Defra’s Future Water Resource Management Project, opened the second panel which explored the use of market mechanisms for promoting water stewardship. He explained the need for a reform of the current water abstraction licensing system, highlighting that the current system is not flexible enough to respond to alternating floods and droughts due to climate change. Leveson-Gower urged the need for more efficient use of water resources and outlined three economic incentive-based options currently being considered by the government. 

Alice Piure, Strategy & Policy Analyst at Anglian Water, presented interesting findings from a research project that explored the use of various types of water trading and their contribution to promoting water stewardship. Finally, Jon Stern from City University London discussed market-based approaches to dealing with periodic water scarcity, in particular the sale of raw water from one region to another.

The third panel offered academic perspectives on state regulatory approaches to water stewardship. Donald McGillivray of Sussex University gave a historical overview of the approach taken by the common law to regulate water stewardship. He argued that the current regulation gives mixed legal messages about water rights and sustainability as there is no real clarity regarding the regulatory goals.

Prof. Bill Howarth of Kent University pointed to the significant advances that have been made in regulation to anticipate and manage the risks of unpredictable events such as floods or droughts, but argued that much more must be done to effectively enhance ‘water security’.  Dr. Sarah Hendry from Dundee University closed the session with some contrasting insights from Scottish water regulation.

The final panel involved a round-table discussion regarding the future research agenda in water stewardship. Various themes were raised, including the challenge of reconciling potentially different competing regulatory goals, specifically ‘water security’ and ‘food security’, as well as challenges to and opportunities for developing cross-disciplinary perspectives on water stewardship.

By Sebastián Castro, DPhil Student, Centre for Socio-Legal Studies, Faculty of Law, University of Oxford.

View workshop presentations and podcasts