In the Wall Street Journal, Gary Libecap and Robert Glennon discuss the West's outdated water laws. A policy overhaul, they argue, would allow efficient water markets and reward conservation.
Ecosystem services such as clean water from forests are free, but now their value is being recognized. Entrepreneurs are developing markets for these services and providing incentives for conservation.
Markets for ecosystem services such as water filtration, erosion control, and pollination benefit the providers and enhance environmental assets.