Abstract
In a region with shared water aquifers, the use of water by one country becomes an externality to another. A policy to subsidize water is shown to lead to both countries being made worse off. However, such policies tend to receive the support of special interests having water rights, and those in sectors such as agriculture that uses water relatively intensively. A unilateral water tax will reduce own country's GDP and rise GDP in the other country. Only when both countries impose a tax co-operatively, will GDP rise in both countries. Copyright © 2000 John Wiley & Sons, Ltd.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
