Argument: Water can be treated as an economic good
The first-ownership-to-first-user principle
- Murray N. Rothbard. "Who Owns Water?". September 2, 2002 - "the first-ownership-to-first-user principle is a method of bringing unused, unowned property into ownership – into the market. After this is done, it is clear that the property, having been mixed with the labor and other effort of the first owner, passes completely and absolutely into his hands. From then on, it is his property to do with as he wishes. It may turn out to be uneconomic to use the property after a few years, and it will lie fallow. To leave his land fallow, however, should be an owner's privilege, for he should continue to have the unquestioned right to do with the property as he sees fit. Once the first user obtains the property, it must be absolutely his."
The idea of water as an economic good - supply/demand, value/price
- "Water as an economic good". The World Bank. 1996 - "The idea of 'water as an economic good' is simple. Like any other good, water has a value to users, who are willing to pay for it. Like any other good, consumers will use water so long as the benefits from use of an additional cubic meter exceed the costs so incurred. This is illustrated graphically in Figure 1(a), which shows that the optimal consumption is X*. Figure 1(b) shows that if a consumer is charged a price P1, which is different from the marginal cost of supply, then the consumer will not consume X* but X1. The increase in costs (the area under the cost curve) exceeds the increase in benefits (the area under the benefit curve) and there is a corresponding loss of net benefits (called the 'deadweight loss.)"
The Dublin Principles 1992, calling water an economic good
The 1992 International Conference on Water and Environment led to the Dublin Principles, the fourth of which states "water has an economic value in all its competing uses and should be recognized as an economic good."
Sources claiming that water is a commodity, not a right
- Baumann and Boland (1998) - "Water is no different than any other good. It is no more a necessity than food, clothing, or housing, all of which obey the normal rules of economics."