WATER SUBSIDIES, WATER TRANSFERS, AND ECONOMIC EFFICIENCY.

The article analyzes the implications of entitlement ceilings for U.S. federal water policies and several proposals for policy reform, including eliminating transfer restrictions, reducing pricing subsidies and imposing groundwater pump taxes. According to the article, farmers buy water from the Bureau of Reclamation under long-term contracts that exempt them from repaying interest costs that the Bureau incurs in developing the water. Both state and federal law and the Bureau's administrative practices mandate a variety of restrictions on subsequent transfer.