The Opportunity Cost of Water

With the continuing drought in South Texas, the issue of how to allocate scarce water resources has flared up again. Rice farmers south of Austin want water from the Colorado River for their crops; yet the two storage lakes on the river, which provide most of the Austin area’s drinking water, are less than half full.  As one rice farmer told the the Austin American-Statesman: “Water availability should be based on sound hydrology and not on political pressure.” It should be based on neither—it should be based on economics—what is the opportunity cost of the water?  In particular, one might ask why the U.S. is growing rice at all.  It is hard to believe we have a comparative advantage in rice-growing and that it shouldn’t all be imported.  That’s especially true about rice grown in dry South Texas. We grow rice because of entrenched interests that obtained water rights many years ago.  The rice farmers get heavily subsidized water precisely because of the political pressure this man deplores—and they now want to compound the effects of bad policy.

The Green Lawns of Texas: A Photo Gallery

In our podcast “Riding the Herd Mentality,” Marketplace reporter Krissy Clark spent some time in west Texas with Barbie Jones, president of the Grassland Estates homeowners’ association; Wes Perrythe mayor of Midland; and local talk-show host Robert Hallmark to learn about how lawn-obsessed residents dealt with the drought. (You can download/subscribe to the podcast at iTunes, get the RSS feed, or listen via the media player here.) Here are some photos from Clark's trip.

Why Water Will Never Be the Next Oil: A Guest Post by Charles Fishman

Here now is the second in a series of guest posts from Charles Fishman, whose new book is called The Big Thirst: The Secret Life and Turbulent Future of Water. (Fishman’s last book is The Wal-Mart Effect.) In The Big Thirst, Fishman tackles the debate around water as an increasingly precious resource while reminding us […]

The Strange Economics of Water, and Why It Shouldn't Be Free: A Guest Post

Water is a topic that's come up repeatedly on this blog. We've written about attempts to do away with bottled water; why it's a bad idea to ban bottled water; whether festivals should hand out free water; and the need for safe supplies of water around the world.

Why Doesn't SXSW Hand Out Free Water?

A reader named Shira Bannerman writes:

I just spent the week at SXSW, an indie music festival in Austin, TX, that attracted around 230,00 attendees. (Well, first it’s an interactive media and movie fest, but I only went for the music fest portion. I’d also specifically like to mention that my experience is only reflective of the free concerts, as I didn’t pay for a wristband and don’t know if that experience is much different.)

World Water Day: Nudges for Safe Water

What if a simple ‘nudge’ could massively increase the use of safe water in poor countries?

Today is World Water Day, a day to raise awareness for something we take for granted in America: clean water. Normally I yawn at Hallmark-meets-poverty-program type publicity stunts. Reminds me of many a microcredit “awareness” campaign that paraded superstar microentrepreneurs on a stage, ignoring the need for rigorous evidence to find out if microcredit actually works.

In Favor of Price Gouging?

Do high prices discourage unnecessary hoarding?

Water Around the World

March 22 was World Water Day, and two excellent photo essays draw attention to the issue.

Grazing the Non-Commons

Central Texas is having its worst drought in 50 years, and since May we have been limited to twice-a-week lawn watering. With things getting worse, on August 24 the limit goes to once per week. I'll abide by the limit, but I'll set my sprinklers to run longer each session than during the twice-a-week watering.

Debating the Future of Water

Photo: r-z If you’re looking to get your mind off the financial disaster and instead focus on another potential disaster — the worldwide water supply — you might want to check out The Economist‘s online debate on the subject. From The Economist: It’ll be a two-week long, Oxford-style online debate on the topic of the […]