We consider the connection between water marketing and the modification of property rights to water in Australia, highlighting the Australian’s distinctiveness through a contrast with water rights in the western US (especially California). Australia started out the same as California, but in the 1880s it abandoned California’s system and adopted a new approach, ending the common law property right to water and creating a statutory right that could be modified by administrative fiat. This shifted the arena for dispute resolution from courts to parliaments. It eliminated the seniority inherent in appropriative water rights and it sidelined issues of third-party impacts. Another difference was the tight control of irrigation institutions by state governments and the national government’s willingness to intervene in state and local water management. Australian water reform was wrapped in politics. When there were successes, this is because the politics were managed adroitly; when political challenges proved insurmountable, reform stalled.

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