17 May 2016

Use of Economic Instruments in Water Policy -- the review

I worked on the Economic Policy Instrument-Water project from 2011 to mid 2013. This book represents one of the final outputs of the project. I was sent the copy I am reviewing here -- as both an insider (I worked with all these authors) and outsider (I published my work elsewhere).

My review will be brief, as I am discussing more the book and its use than the merits of the particular case studies.

The book aims to explain how economic instruments affect water use (and abuse) with the examples from about 25 case studies from the EU and another 5-6 countries. These case studies are arranged in a "fixed" format such that each case study presents information in the same order for the same topics. This format makes it easier to campare cases side-by-side but it makes it harder to present the individual character of each case.*

The book has introductory and concluding chapters, as well as section defining chapters for the different types of EPIs. It's at this point that readers can read 5-8 cases on the various types of EPIs: Pricing, market trading, and "other types of incentives." Those first two categories obviously fall into the economic arena, but the "other incentives" concern cases where voluntary cooperation and other forms of communal negotiation mattered. Although you might call that last group "economic" in terms of creating value, I tend to separate them into the "political" bucket occupied by non-excludable public and common pool goods. (Economic incentives make more sense with excludable, private or club goods.) It's thus that this book's definitions may be confusing to some readers. One thing that I think you should see (it's drawn from my 2011 paper with them [pdf]) is the figure at left (click to enlarge), which shows how to evaluate instruments for performance and what factors affect instrument implementation. Those categories are worth thinking about.

Turning to the content of the chapters and book (draft versions appear here), I was slightly surprised to see some glaring typos and signs of potential copy/paste errors. As to the cases themselves, I have to say that some are stronger than others. The sad thing was that we did not all have time to read and comment on each others' chapters during the project. Thus, I think that some of the chapters didn't get the peer review they deserved (although I am sure they are better here than in draft form). I know that my papers went through 2-3 rigorous (painful) revisions before they were published.

I see from the book's website that it has over 2,000 downloads. That sounds huge to me, for a €100 book (or €30 chapter!), but it may reflect Springer's "bundling" of the book with other subscriptions. My advice to curious readers is to look at a few drafts before spending on the book. If you've got an academic subscription, then definitely download it -- make sure you read chapter 28 first, to get a feel for how the book's ideas are supposed to be organized.

Bottom Line: I give this book FOUR STARS for making it easier for academic and professional readers to get a feel for how EPI begin, evolve, succeed and fail.

* I preferred to revise the papers around their core topics rather than use the EPI-Water format. Thus, I could not also publish in this book. These papers are: