Towards Design for a Nutrient Trading Programme to Improve Water Quality in Lake Rotorua

This paper explores how to enhance the role for academic research (natural sciences, economics and their integration; and stakeholder management) within the development and implementation of water quality policy in New Zealand. Our focus is on the use of market based instruments and particularly nutrient trading programmes, which are one important part of the potential tool kit to address these issues. We discuss why nutrient trading might be an appropriate instrument for the Lake Rotorua catchment. We survey the existing literature and then outline the outstanding scientific, economic and governance questions that need to be addressed to design an effective trading programme. Finally we discuss how to design a process to address these questions drawing on both technical and practical knowledge through a learning process.