Aspects of water markets for developing countries: experiences from Australia, Chile, and the US

TLDR

Water market reforms promoted by international organisations have limited real‑world experience, especially in developing countries, making it essential to learn from the few functioning markets such as those in southeastern Australia. This paper examines outcomes of water trade in southeastern Australia and, together with US and Chilean experiences, outlines lessons for introducing markets in developing countries.

Abstract

Water market reforms are being promoted by international organisations, such as the World Bank, and pursued within many developing countries. Actual experiences with water markets are limited and the opinions regarding the beneficial or detrimental impacts diverse. It is therefore crucial to learn from the few functioning markets. Some of the longest operating, and most mature markets in the world, are to be found in Southeastern Australia. This paper examines the outcome of water trade in Southeast Asian Australia and combined with US and Chilean experiences outlines some lessons for the introduction of markets in developing countries.