Rescuing Water Markets: Lessons from Owens Valley

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In the early twentieth century, Los Angeles purchased water rights by buying up farmland in Owens Valley on the eastern side of California and conveying the water to Los Angeles. These purchases created a legacy of distrust and suspicion, as people over time began to view the trades as theft. Memorialized in the 1974 film Chinatown, the image of the Owens Valley trades has cast a shadow on water trading ever since—even when the goal of trades is environmental protection.

In “Rescuing Water Trades: Lessons from Owens Valley,” Gary D. Libecap takes a second look at the Los Angeles–Owens Valley transfers. He shows that the actual events have become distorted in the retelling, but also reveals the genuine problems that surrounded the negotiations. He applies the lessons to water trades today.

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