Water Price Reforms in China: Policy-Making and Implementation

Following the conviction that economic and pricing approaches are an essential addition to conventional command-and-control environmental regulation, China has gradually increased attention to, research on and experiments with the application of economic instruments in urban water management over the past two decades. This paper analyzes the actual application and implementation of economic instruments in Chinese urban water sectors, applying an ecological modernization perspective. Water tariffs in China have increased sharply over this period, increasingly representing full costs and increasing water use efficiency. But implementation of water tariffs does run into problems of unclear responsibilities, poor collection rates and institutional capacities. It is concluded that Chinese style ecological modernization should pay more attention to the institutional dimensions of natural resource pricing policies, if it is to profit from the theoretical advantages of economic approaches in urban water management. Copyright Springer Science+Business Media B.V. 2010