David Zetland of Aguanomics on Remaking the Water Market

Water shortages are already major problems in several areas of the US, and they are only going to become more common. David Zetland, senior water economist at Wegeningen University in the Netherlands, author of the blog Aguanomics and the new book The End of Abundance: economic solutions to water scarcity, discusses flaws in American water policy and how market-based price principles might be used to encourage sustainable levels of consumption.

The issue with current water policy is that pricing schemes, for both commercial and residential applications, do not reflect the scarcity of the resource. Farmers' irrigation needs are highly subsidized regardless of sustainability. And “all you can eat” residential water systems, in which residents pay a flat monthly rate for water, encourage wasteful consumption. As water becomes an issue of more importance, Zetland argues, these pricing schemes will have to change.

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Posted in: Aguanomics, David Zetland


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