The limits of markets: the politics of water management in rural Australia

The intensity of conflict over water and water management has been increasing. Focusing on the recent federalist compact, the National Water Initiative (NWI), the use of market and property rights instruments in water governance in Australia are explored. Does the use of such instruments imply a reduced role for the state, as new instruments displace previous top down or regulatory modes of governance? The view that the new market-based system of governance can be self-managing is challenged. It is argued instead that the market requires substantial meta-governance, which challenges approaches to governance that assume a reduced role for the state.