Battles over limited water supplies in the United States and around the world have long produced conflicts and costs to affected communities. While limited supplies are a problem in and of themselves, political management of water is the key problem. Government control of water allocation generally produces inefficient and unfair results.
- A property rights-based system could alleviate water shortages and pollution problems by properly pricing water resources and giving parties a stake in ensuring water quality.
- Policy makers should rethink current approaches to facilitate water markets, which have developed in some areas and show great promise.