Topic Area: Water Allocation
Geographic Area: California, USA
Focal Question: What conclusions can be drawn about waterallocations Comprar Gh Jintropin and water markets in "buy cheap jintropin online" light of the California DroughtEmergency Water Banks of 1991 and 1992?(1) Howitt, Richard E., "Empirical Analysis Trenbolone Acetate Powder Suppliers of Water MarketInstitutions: The 1991 California Water Market", Resource and EnergyEconomics, Vol. 16, No. 4, (1994). pp. 357 371.
(2) Nandrolone Steroids Israel, Morris and Jay R. Lund, "Recent California WaterTransfers: Implications for Water Management", Natural ResourcesJournal, Vol. 35, No. 1, (1995). pp. 1 32.
Reviewer: Peter Bingenheimer, Colby College '96California experienced a long period of drought between 1987 and1992. These Banks were significant in that they were the first largewater transfer programs in the US set up and run by a stategovernment. The basic format was essentially the same for both Banks,though they performed quite differently. Comprar Viagra Specifically, theydrafted contracts for the purchase and sales of water, and performedas the agent through which transfers passed.
In the case of the 1991 Bank, the DWR set a fixed price for bothpurchases of water by the Bank and sales of water by the Bank. Thepurchase price of water was set at $100/1000m3, and the Bank bought1,013,000m3. The remaining water came from surface water supplies inNorthern California that had excess water.
The sale price of water was set at $140/1000m3 by the DWR, and theBank sold 488,000m3. About 80% of the water sold by the 1991 Bankwent to urban municipal and industrial uses. The remaining 20% waspurchased for agricultural use. The difference between purchase priceand sale price represented the cost of water carriage. The differencebetween quantity purchased and quantity sold can be accounted for inthe following way: In order to maintain water quality standards, theBank had to release 20 30% more water into the system than itremoved; the remaining surplus, 37% of the total water purchased, wasa result of poor planning, and was purchased Günstig Kamagra Oral Jelly Kaufen from the bank by the DWRas a backstop.
As a result of lessons learned from the 1991 Bank, the 1992 DroughtEmergency Water Bank functioned more efficiently than itspredecessor. The surplus of water that resulted in the 1991 Bank ledthe DWR to change the contract system. Specifically, a dual contractsystem was implimented. Under this system, buyers and sellers whocommitted to the Bank early made a deposit on the water they thoughtwould need or would be able to supply. This allowed the Bank toanticipate supply and demand more accurately. Thus it was able toavoid much of the excess supply that existed in the 1991 Bank. Othermeasures intended to limit the surplus in the 1992 Bank included muchlower purchase and sale prices and a ban on water from fallowedland.
The 1992 Drought Bank purchased water at a price of $40/1000m3. Theybought only 232,990m3 of water, 23% of that purchased in 1991. 80% ofthis water came from farmers who substituted surface water withground water. The remaining 20% came from surpluses in NorthernCalifornia surface water supplies.
The Bank sold all the water at a price of $58/1000m3, though thisprice was not officially fixed. Unlike the 1991 Bank, the majority(60%) of this water went to agricultural uses. The Department of Fishand Game bought 15% of the water to account for undervalued instreamuses, and the remaining 25% went to urban uses.
Many conclusions can Tadalafil Powder Research be drawn about water transfers and waterallocations in light of the California Drought Emergency Water Banksof 1991 and 1992. The Banks were essentially institutions designed totransfer water from low valued uses to high valued uses during aperiod of intense scarcity. Transfers were needed because the waterallocations during non drought periods did not necessarily reflectthe high valued uses during a drought. One can take this further by saying thatwater would Buy Cheap Jintropin Online be allocated more efficiently if water markets wereallowed to operate freely. That is, water would go to high valueduses in the absence of government regulations and laws that limitwater transfers and raise transactions costs. Specifically, riparianrights, which are currently non transferable in California andelsewhere, should be made transferable. They were transferable whilethe Banks were in existence, and were a major factor in the successof the Banks. If property rights were clear, secure, andtransferable, owners of the water (or the right to the water) wouldallocate it in such a way as to maximize the present value of netbenefits. This would ensure the continuity of the water supply exceptin the presence of an extremely large discount rate. Some would arguethat the success of the Banks indicates a need for more governmentintervention. That is a superficial conclusion, however, because theBanks were, in a sense, temporary exceptions to policies that limittransfers. In addition, environmetal impacts that do not directlyeffect the owner of the water must be accounted for with governmentpolicy. The combination of market forces and properly targetedpolicies would lead to an efficient water allocation which would besustainable both in terms of the water supply and the overallenvironment.