A common-pool resource approach for water quality management: an Australian case study

Water is perhaps one of the most studied types of common-pool resource (CPR) goods. Its quality, however, has not been discussed as much in the CPR literature as its quantity. We examine the significance of studying water quality from a CPR perspective, and then analyze implications for the formulation of institutional arrangements to improve water quality. We illustrate with a case study in South East Queensland, Australia. This involves a rural catchment (watershed) that contributes high sediment and some nutrient loads to the Brisbane River, where it affects urban water quality and visual amenity, water treatment costs, and dredging costs at the port. The pollutants then threaten marine water quality and habitat values for threatened species in Moreton Bay, a marine protected area. We analyze the potential for a CPR understanding to enhance the design and financing of a water quality management regime. Rather than seeking to supplant conceptualizations of externalities as a basis for design of policy instruments, we propose arrangements that combine the CPR and externality concepts to offer a powerful logic and financial basis for collective management. Market-based instruments could facilitate downstream populations to help pay for catchment restoration in return for enjoyment of improved water quality resulting from strengthened ecosystem services, while associated non-market-based instruments could help all parties understand and expand their roles under a common-pool management regime. We argue that recognition of CPR attributes provides a logic for cooperation and co-investment between stakeholders who are in a position to affect, or are affected by, water quality in different parts of a large river system.