Author(s)

Muhammad Ashfaq Ahmed, Nasreen Nawaz

Federal Board of Revenue, Islamabad, Pakistan.

Water markets even though not perfect and require a lot of effort to establish are considered as a robust tool to address water management issues around the world. However, the existing literature does not provide an optimal water resource management policy. To create a perfect water market, the government needs to identify the potential number of suppliers/producers and consumers of water against various extraction/supply/production rates of water, i.e., to identify a supply and a demand curve for number of suppliers/producers of water against each production rate in economy. This article presents a theory which is practically applicable for an optimal dynamical water resource management policy (JEL H20, H23, H27).

Water Market, Production Rate, Dynamic Efficiency, Adjustment Path, Equilibrium

Ahmed, M. and Nawaz, N. (2023) Theory of an Optimal Dynamical Water Resource Management Policy. Journal of Water Resource and Protection, 15, 85-113. doi: 10.4236/jwarp.2023.153006.