Negative Externalities of the Water Rights Trading Pilot from the Perspective of Industrial Collaborative Agglomeration

Water rights trading is a market-oriented method of allocating water resources and an effective means of improving water resource efficiency. China have implement this pilot policy for 8 years,it is believed that the pilot policy is effective in improving water utilization efficiency, which we have explored by fair game cross DEA approach. However, more important, the pilot scheme breaking the original national market, fragmentation led to part of the rebound effect of this policy. We found that the degree of attenuation of this effect is around 25%. Heterogeneity across different pilot areas have been discussed. We believe that this study can serve as a reference for other countries or industries that implement similar pilot policies