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This paper evaluates own-price dynamics in taxing environmental externalities. We exploit a natural experiment that exposed some firms to a large and persistent price increase for groundwater, a setting characterized by incomplete markets. Using five years of post-treatment data on farm-level water use, we find that water conservation doubles between the first and fifth year of the tax. Failure to account for dynamics in policies designed to manage groundwater will mischaracterize the price elasticity of demand and introduce efficiency costs.

Droughts are becoming more frequent and intense in California. Many California watersheds experience seasonal water scarcity nearly every year. To protect water rights, human health and safety, and the environment from serious harm, California’s State Water Resources Control Board (SWRCB) needs to be able to routinely curtail unlawful water uses. But it has struggled to carry out this basic function, running into resource constraints and technical, legal, and political barriers. This report describes the legal context for and history of curtailments in California. It also recommends actions the SWRCB and State Legislature can take to build a framework for fair and effective curtailment in California.

In California, droughts are likely to become more frequent, longer, and more intense in the future, posing increasing challenges for water management, and raising the stakes for effective drought response. This project aims to help state water governance and decision-making structures adapt to the changing climatic reality. In a companion report in this volume, we analyzed the strategies the State Water Resources Control Board (Board) used for water rights administration and oversight during the last four major statewide droughts. Our findings suggest that more proactive planning and preparation, enabling reduced reliance on in-drought improvisation, would improve the Board’s future drought responses. This report builds on that retrospective analysis with specific recommendations.Our vision is simple: During droughts, California’s limited water supplies should be allocated among different human and environmental water uses transparently, efficiently, and predictably, in accordance with the priorities that flow from state and federal law.We suggest a structured means of implementing this vision that emphasizes proactive drought preparations. At the core is a contingency-based framework designed to support more timely and effective drought decision making. A suite of complementary actions aims to reduce uncertainty and lay the groundwork for improved water rights administration and oversight in future droughts. These actions include making key policy decisions that affect drought response in advance, strategically improving decision-related information, maximizing learning from droughts, prioritizing water rights enforcement between droughts, and capitalizing on the many synergies that exist between the Board’s drought and non-drought work to achieve better water management outcomes, greater clarity for water users, and more efficient use of state resources. We view these actions as crucial components of effective climate adaption for California and encourage the Board to begin implementing them now, so that it is better prepared to face the challenges the next drought brings.

California droughts are likely to become more frequent, longer, and more intense in the future, posing increasing challenges for water management, and raising the stakes for effective drought response. This project aims to help state water governance and decision-making structures adapt to this changing climatic reality.The State Water Resources Control Board (Board) has significant responsibilities for California water rights administration and oversight, and the decisions it makes affect how scarce water resources are allocated among different human and environmental uses during droughts. We analyzed the strategies the Board used for water rights administration and oversight during the last four major statewide droughts, in water years 1976–1977, 1987–1992, 2007–2009, and 2012– 2016. The Board employed an array of different drought response strategies that varied in depth and breadth from drought to drought. We discuss thirteen types of strategies organized into four broad categories: (1) addressing urgent water right requests, (2) providing oversight of existing diversions, (3) providing oversight of water use by end users, and (4) cross-cutting strategies that support or complement strategies in the first three groups. The Board engaged in the greatest breadth and depth of strategies during the recent drought.Despite some significant and creative in-drought efforts by the Board and others, which led to positive developments during and immediately following each drought, relatively little proactive preparation for drought-specific water rights administration and oversight appears to have occurred between droughts. Instead, our research suggests the Board developed its drought responses on a largely ad hoc basis in the midst of each drought emergency, with varying degrees of success. We conclude that more proactive planning and preparation would improve the Board’s future drought responses, making them more transparent, predictable, timely, and effective. A companion report in this volume builds on this analysis with specific recommendations

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Community-based participant-observation purposefully combines participant-observation and community-based participatory research. While participant-observation is the core method of ethnography and foundational to cultural anthropology, community-based participatory research initially emerged from health and related applied sciences to align researchers' and communities' agendas through focused collaboration. Participant-observation and community-based participatory research have different scholarly origins and norms but are united in centering communities' understandings on their terms. Combining the strengths of both, we provide a step-by-step explanation of community-based participant-observation, with examples from a study of water insecurity in colonias north of the U.S.–Mexico border. Using community-based participant-observation, researchers can facilitate the co-production of knowledge and community benefit by analyzing high-quality data that inform theory building and basic research. [ABSTRACT FROM AUTHOR]

The article presents the discussion on Blue Ribbon Committee on Water Rates (BRC) set up by Los Angeles Mayor Bradley in the summer of 1991. Topics include rates were recommended by the BRC in June 1992, adopted with small changes by the City Council in December 1992, and took effect in February 1993; and similarities and, more importantly, differences with the situation of tariff setting for household water use in low and middle income countries.

This paper uses a finite mixture logit (FML) model to investigate the heterogeneity of preferences of beach users for water quality at beaches in Southern California. The results are compared with conventional approaches based conditional logit (CL) and random parameters logit (RPL). The FML approach captures variation in preferences by modeling individual recreator preferences as a mixture of several distinct preference groups, where group membership is a function of individual characteristic and seasonal variables. The FML parameter estimates are used to calculate welfare measures for improvements in beach quality through a reduction of water pollution. These bound the traditional CL and RPL mean welfare estimates, and have the advantage of highlighting the distribution of the population sample's preferences. The data indicate the existence of four representative preference groups. As a result, willingness to pay measures for improvements in water quality can be weighted across individuals to calculate the distribution of individual welfare measures.One of the groups is people who go to the beach with small children. An interesting finding is that these people have a lower mean WTP for improving water quality than people who go without a small child. This may well be an example of cognitive dissonance: parents find they go to the beach more often than others who don't have small children, since that keeps the children occupied and happy, and they adapt their perception of the water quality to be consistent with their behavior.Previous environmental and resource economic applications of the FML have been limited to applications with small choice sets (6) and group membership variables (4). This paper extends the FML model through the estimation of a large (51) choice set with 9 membership variables. This application is the first to incorporate seasonal variables into the group membership function to capture seasonal heterogeneity.

Economists have for decades advocated transferable property rights, in which the total annual allowable catch is divided into shares, which are then tradable, as a market mechanism to decrease overcapacity. Tradable property rights, or individual transferable quotas (ITQs), are a significant departure from command-and-control regulations that impose combinations of gear restrictions, season limitations, license limitations and trip limits. While in theory tradable property rights have clear economic advantages over command and control, Federal fisheries managers face the challenge of evaluating and ranking regulatory options in a world of complexity and uncertainty.The goal of this project is to describe the changes in the composition of the Mid-Atlantic surf clam fishery, which has been regulated with first command and control and then tradable property rights. The data analysis indicates that while there were changes in the structure of the clam industry, the introduction of tradable property rights did not lead to a redistribution of welfare across different types of participants in the industry.