Market mechanisms to nudge better watersheds management

The traditional approach to managing watersheds globally is to do so using state regulations, or through publicly funded initiatives. A recent analysis by the United Nations Environment Program (UNEP) shows that using market mechanisms to incentivise better watershed management is a good complement to these more widely used methods.

Market incentives should not be seen as a replacement, or a panacea, to these older, tested methods of conserving or restoring important watersheds, however, warns lead author Prof Edwin Muchapondwa. 

Muchapondwa, a resource economist at the University of Cape Town’s Environmental Policy Research Unit (EPRU), was commissioned by UNEP to lead a review of case studies from around the world, looking at examples where market incentives have been used in the context of watershed management.

The report, titled Use of Market-based Incentives in Watershed Management: Driving the Green Economy through involving Communities & the Private Sector, finds that these sorts of incentives can make environmental management more efficient. They can be a means to raise revenue to assist the state with various levels of implementation, which is critical in order for all forms of watershed management to be successful.

An overview of the report’s findings will appear in the South African Water Research Commission’s (WRC) magazine Water Wheel in May 2017. Meanwhile the full UNEP report is available through the Environment for Development initiative, a partner with EPRU.

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News | 22 March 2017