Defining tradable water entitlements and allocations: A robust system

Posted January 2006

By Mike Young and Jim McColl

This paper, which appeared in the Spring 2005 edition of the Canadian Water Resources Journal, explains that robust systems are characterized by a capacity to recover gracefully from the whole range of exceptional inputs and situations in a given environment. They have a connotation of elegance. This paper highlights the importance of separating the different elements of any tradable property entitlement and allocation system into its component parts.

The result is a constellation of institutional arrangements that can be expected to last, to withstand the test of time. Often, considerable reform is required to put in place robust systems. Using examples from Australia, this paper highlights the importance of sequencing implementation of the reforms necessary to put robust systems in place. Robustness is achieved by using three instruments rather than one to allocate water and control use, and coupling these three instruments with three separate planning instruments.

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