Dinar, A.: Advanced Introduction to Water Economics and Policy. Cheltenham–Northampton, Edward Elgar, 2022. 132 p. 221DOI: 10.15201/hungeobull.74.2.7 Hungarian Geographical Bulletin 74 (2025) (2) 221–224. Water economics and policy play a crucial role in managing water as a vital resource and addressing its allocation and sustainability. Water scarcity affects billions’ lives worldwide, exacerbating competition among agricultural, industrial, and domestic users – even in countries which were considered rich in water for a long time but are increasingly suffering from declining water resources due to climate change, including regions like the Danube–Tisza Interfluve in Hungary. Hence, the efficient use of water is a critical task for contemporary societies. Efficient use, however, requires effective water economics involv- ing proper pricing that reflects the real value of water and encourage conservation and efficient use, as subsidized water rates can lead to overconsump- tion, while consumption-based pricing and pricing reforms can reduce waste (Dinar, A. and Yaron, D. 1992). These questions are investigated in much detail in the current book, providing a comprehensive and authoritative overview of water economics and policy. The author of the volume, Ariel Dinar, is a Fulbright Senior Specialist and a Distinguished Professor of Environmental Economics and Policy at the University of California, Riverside (UCR), and School of Public Policy. His book, published in 2022 with Edward Elgar, represents the many years of Dinar’s practical and research experience in the field of water economics and management. While exploring water economics and policy, it covers topics like water scarcity, environ- mental flows, and ecosystem services. It includes ex- amples from different countries (e.g., the United States, Australia, and South Africa) and analyzes the most significant water-using sectors. The volume provides an opportunity for the readers to understand water management from an economic perspective. The volume contains 10 regular chapters, whereas Chapter 11 provides a summary of the entire book. The book refers to four case studies that exemplify innova- tive water management strategies and highlight success- es, challenges, and lessons for global water governance. The results in the case studies justify the importance of institutional frameworks and governance, market-based allocation and trading, environmental considerations, stakeholder engagement and participation, and trans- boundary cooperation and agreements. Dinar addresses the following research questions: – Water economic and policy fundamentals: What are the fundamental principles of water economics? How are water markets and pricing mechanisms functioning? What are the key challenges in water supply and demand management? – Water allocation and markets: How do water allo- cation mechanisms impact economic efficiency? What are the benefits and limitations of water markets and trading? How do water rights and institutions influence water allocation? – Water governance and institutions: What are the key features of efficient water governance? How do in- stitutions and policies impact water management outcomes? What role do stakeholder participation and engagement play in water governance? – International water policy and cooperation: What are the principles of international water law and coop- eration? How do transboundary water agreements impact water security? What are the challenges and opportunities in international water cooperation? In Chapter 1, Dinar provides a solid foundation for the book, introducing essential concepts and the context of the book under review. The chapter dives deeper into water’s economic value and highlights the complexi- ties and nuances involved in evaluating water’s value. Considering water, Dinar differentiates between three sorts of economic value. First, the instrumental value of water, which reflects water’s utility in various economic Dinar, A.: Advanced Introduction to Water Economics and Policy. Cheltenham–Northampton, Edward Elgar, 2022. 132 p. 222 Book review section – Hungarian Geographical Bulletin 74 (2025) (2) 221–224. activities such as agricultural production, industrial processes, energy generation, municipal and domestic use, etc. Second, he highlights the intrinsic value of water, referring to water’s inherent worth and importance be- yond its utility, economic, or functional value. In this concept, Dinar acknowledges that water has value in and of itself, regardless of its use or benefits to humans. As he highlights, some aspects of the intrinsic value of water could include water’s ecological impor- tance, aesthetic appeal, and cultural and spiritual signifi- cance. I believe that recognizing the intrinsic value of wa- ter encourages a more holistic and sustainable approach to managing it and conserving it for future generations. The book also recognizes the existence value of wa- ter, which directly represents the societal benefits of water such as aesthetic and scenic value, and water’s value for biodiversity conservation and climate regu- lation. Dinar also makes a strong case with regard to the real-world application of valuing and preserving water, where he elucidates on cost-benefit analysis for water infrastructure projects. In Chapter 2, two countries (Morocco and Israel) are employed as case studies to highlight high levels of wa- ter scarcity and abundance. According to Dinar, since 1962, Israel faced a reduction in its water availability from 330 to 90 m3/capita per year, which is nearly 70 percent reduction. In the same period, Morocco faced a decline from 2200 to 850 m3/capita per year, which is nearly 60 percent reduction. The significant reduction in water availability in both countries resulted from various factors such as rapid population growth, in- tensified agricultural water use (accounting for 88% of overall end-use), over-extraction and inefficient use (including outdated irrigation systems and the lack of water conservation measures), changing precipita- tion patterns and increased evaporation due to rising temperatures as the result of climate change. In Israel, this shift has resulted in significant economic costs and environmental impacts, including the discharge of con- centrated brine into the ocean, which can harm marine life. The situation is not much different in Morocco as reduction has exacerbated water scarcity issues, par- ticularly in rural areas, resulting in significant implica- tions for agriculture, industry, and human consump- tion, leading to food insecurity and economic losses. Hence, the consequences of reduced water availability in both Morocco and Israel are far-reaching and inter- connected, which highlights the need for sustainable water management practices, increased efficiency, and conservation measures to address this critical issue. Dinar accentuates in Chapter 4 the importance of flex- ibility in water allocation and water storage solutions, and the importance of stakeholder engagement, a phe- nomenon that led to a major stride in the successful im- plementation of California’s Water Market and Trading System. California has experienced many droughts over the years. This has led to the introduction of various poli- cies related to water conservation, declaring conservation a way of life by the California State Legislature (Dinar, A. and Tsur, Y. 2021). Another classic measure is the Australia’s Murray-Darling Basin Reform, which is an example of successful water governance through market- based mechanisms, environmental consideration, and collaborative management. These cases illustrate that effective collaboration and stakeholders’ engagement are positive ways to ensure sustainable water governance system (Grafton, R.Q. et al. 2011). Dinar makes it succinctly clear in Chapter 3 that wa- ter scarcity can be addressed through various strategies, such as economic incentives, pricing mechanisms, water markets and trading can improve allocation efficiency. While water markets can promote efficient water use by allocating water to its most valuable uses (Bauer, C.J. 2004) and serving as a potential tool for managing water resources sustainably, strategic investment in water infrastructure is crucial for economic growth in general (Bosworth, B.P. et al. 2002). As Dinar highlights in Chapter 9, the impact of, and adaptation to, climate change in the wastewater sector (based on data from China) and the irrigated agricultural sector (according to data from the Júcar River Basin in Spain) are further critical topics, for both sectors are highly vulnerable to climate change and may face irreversible damages if water allocation, investment, and long-time planning are not properly coordinated and implemented. The hydrological cycle is heavily impacted by climate change due to the fact that altered climatic conditions caused by the increase in atmospheric levels of CO2 and other greenhouse gases affect the distribution of precipi- tation, which is the main cause of variability in the water balance both spatially and intertemporal. For instance, the frequency of low water levels is affected primar- ily by changes in the seasonal distribution of rainfall (Fecht, S. 2019). In Chapter 5, the author stresses the coordinated re- lationship between the environment, water interactions, and management. According to Dinar, water serves as an important input to sustain healthy water-dependent ecosystems, which provide valuable services such as recreation. According to Watson, L. et al. (2020), the total value of global ecosystem service is estimated at 1.3 tril- lion international dollars in 2005 values. In the same chapter, Dinar highlights the concept of environmental flows, which is the quantity and qual- ity of water that is required to maintain the health and integrity of the ecosystems of a river or stream. These ecosystems encompass the natural flow regime, includ- ing the magnitude, frequency, duration, and timing of flows that sustain the aquatic environment and support the wide array of plant and animal species that depend on it (Brisbane Declaration 2007). The importance of environmental flows cannot be underestimated as they play complex roles such as maintaining aquatic habitats, regulating water quality, preventing erosion and sedi- mentation as well as preserving aesthetic, spiritual, and recreational values of water. 223DOI: 10.15201/hungeobull.74.2.7 Hungarian Geographical Bulletin 74 (2025) (2) 221–224.Book review section – Hungarian Geographical Bulletin 74 (2025) (2) 221–224. However, there are several threats to environmen- tal flows such as water diversion and extraction, the construction and operation of dams, which alters the natural flow regime and disrupts sediment transport, and climate change, which affects the timing, magni- tude, and frequency of flows. It is therefore imperative to advance strategies to mitigate these threats. Chapter 6 takes the reader to economic and policy considerations in groundwater management. Due to the impact of climate change on the sustainabil- ity of groundwater storage, scientists have realized that groundwater level changes correspond to global climate variations (Gurdak, J.J. 2017; Russo, T.A. and Lall, U. 2017; Thomas, B.F. and Famiglients, J.S. 2019). Dinar argues that economic considerations become increasingly relevant as the good or resource becomes scarcer. In the case of water, scarcity is de- termined by the physical amount of water available for use, or by its distribution as affected by climate change, but also by its quality. The direct and indirect negative effects associated with groundwater depletion and contamination on the environment and humans require regulatory in- terventions. Policy interventions such as caps on water extractions, taxes on energy used for pumping, and taxes on water extraction aim to regulate groundwater extraction and agricultural production above an aq- uifer. A remarkable example of intervention policies is the Sustainable Groundwater Management Act in California. Although groundwater in California has not been regulated formally by the state, many proac- tive measures have been adopted by the people, e.g., digging wells into their land and pumping as much water as they need, which have sustained the people during the long drought periods since 2010. In Chapter 8, Dinar examines the various insti- tutional frameworks and agreements that govern international water management, highlighting the challenges and opportunities that arise when mul- tiple countries share a common water source. The focus of the chapter is on the economics and policy of international water management. Frameworks such as the Global Water Governance led to the establish- ment of the Global Water Partnership and the World Water Council, which have facilitated the promotion of global cooperation and knowledge-sharing in water management. Also, formal agreements between ripar- ian states, such as the Treaty of the Nile (1929), and the Indus Waters Treaty (1960), provided a foundation for cooperation and management of transboundary water resources, helping to address conflicts and promote sustainable development. According to Dinar, unco- ordinated national development policies (as different countries may have conflicting development goals, which poses a challenge to managing shared water resources), and differences in economic power and interests can also influence cooperation and conflict among riparian states. These complexities highlight the need for a multidisciplinary approach to manag- ing shared water resources, one that takes into account the economic, political, and social factors at play. Mechanisms for regulating water pollution (Chapter 7) belong to another group of significant policy mechanisms. Depending on the type of water pollution, the observation is that water pollution is increasing as industrial activities become more intensive (Pacific Institute, 2010). Yet, water pollution can also be the result of household-, agricul- ture-, and mining-related water use. While each type of pollution has its own unique characteristics and effects on human and ecosystem health, the principles related to their regulation could be quite similar, which regulating mechanisms need to be addressed adequately. Dinar proposes groups of regulatory mechanisms that can be employed to deal with water pollution. These include (i) Tradeable Discharge Permits (TDP), i.e., an automatic cost-effective abatement mechanism providing strong incentives to polluters to innovate by making their abatement process more effective and efficient, and (ii) emission taxes, which require polluters to pay for their use and abuse of the environmental resources and servic- es. The economic principle behind these mechanisms is that polluters are allowed to emit as much as they want, but they will be charged a fee per each unit of emission. Based on my reading and subjective review and evaluation, Advanced Introduction to Water Economics and Policy offers a unique blend of theoretical founda- tions, practical applications, and cutting-edge research, making the book an essential resource for scholars, poli- cymakers, and professionals in water economics and policy. Readers new to water economics and policy will find it informative, while experts will appreciate the up- dated statistics and framework. The volume, published in 2022, builds upon the foundations established in the edited volume by Dinar, A. and Schwabe, K. (2015) and provides an updated and comprehensive introduction to the topic. It includes significant additional chapters on climate change and water management, which cover the topic of the impact of climate change on water re- sources, water vulnerability, and risk assessment, as well as climate-resilient water infrastructures. The book is an essential resource for scholars, poli- cymakers, and professionals seeking to understand the complex interactions between water resources, economics, and policy. It offers a nuanced understand- ing of water economics and policy, emphasizing the complexities of managing this vital resource. Dinar’s book offers some undisputable novelties that must be emphasized. Dinar was able to integrate economics, policy, hydrology, and social sciences to provide a comprehensive understanding of water management. He also takes a global perspective on water issues, paying attention to countries in both the Global North and Global South, by which he highlights remarkable regional differences and similarities. Thanks to these merits of the volume, readers can draw many lessons from it in economic, policy, and 224 Book review section – Hungarian Geographical Bulletin 74 (2025) (2) 221–224. environmental terms as well. The book also succeeds in accentuating that water economics and policy re- quire interdisciplinary approaches, and efficient gov- ernance and institutions are critical for sustainable water management. However, while the book touches on social and cul- tural factors, it primarily focuses on economic and policy aspects. Its focus on broader social and cultural aspects is limited. I have also observed some technical complex- ity as some sections require sound prior knowledge of economics and hydrology, which many potential readers trained in other water management-related disciplines may not possess. In addition to these, although Dinar highlights the effects of climate change on water resourc- es and social welfare in Chapter 9.2, I believe this topic received marginal attention especially if we consider how climate change-induced environmental shifts have be- come profoundly global, thus, triggering significant so- cial problems for billions of humans worldwide. Another limitation in my view is the limited attention Dinar pays to rural and indigenous communities. The unique wa- ter challenges such as water-borne diseases, health and climate change impacts, water scarcity and variability, etc., faced by these communities are rather overlooked, which hinders the proper representation of the actual problems these people are facing due to the lack of ac- cess to water, and goes against a fair integration of these people’s experiences into the global academic discourse. Nonetheless, the above limitations highlight new opportunities for future research that may refine and expand the academic and professional discourses of water economics and policy. In my view, it would be especially critical to (i) incorporate climate change im- pacts and resilience strategies into the analysis in more detail, (ii) explore non-economic values of water by pay- ing more attention to cultural perspectives on water, (iii) meticulously investigate Global South contexts with special attention to challenges rural/indigenous commu- nities are facing, (iv) integrate interdisciplinary insights from social sciences and ecology, and (v) evaluate the efficiency of policy and governance frameworks. In conclusion, water economics and policy require a multifaceted approach, balancing economic, social, and environmental objectives. By adopting innovative solutions, effective governance, and cooperation, we can ensure sustainable water management for future gen- erations. Therefore, I highly recommend this book to everyone, especially students, researchers, and scholars passionate about policies and governance systems in the water resource sector. Peter Adanu Worlasi1 1 ELTE Eötvös Loránd University, Institute of Geography and Earth Sciences, Department of Social and Economic Geography, Budapest, Hungary. E-mail: peterworlasi@student.elte.hu REFERENCES Bauer, C.J. 2004. Results of Chilean water markets: Empirical research since 1990. Water Resources Research 40. (9):9-6. https://doi.org/10.1029/2003WR002838 Bosworth, B.P., Collins, S.M. and Reinhart, C.M. 2002. Determinants of the global pattern of foreign investment. In Challenges to Globalization: Analyzing the Economics. Eds.: Baldwin, R.E. and Winters, L.A., Chicago, University of Chicago Press, 259–286. Brisbane Declaration 2007. Environmental Flows are Essential for Freshwater Ecosystem Health and Human Well-being. 10th International River Symposium and International Environmental Flows conference. Brisbane, QLD, Australia. https://www.conservation- gateway.org/ConservationPractices/Freshwater/ EnvironmentalFlows/MethodsandTools/ELOHA/ Pages/Brisbane-Declaration.aspx Dinar, A. and Yaron, D. 1992. Adoption and aban- donment of irrigation technologies. Agricultural Economics 6. (4): 315–332. Dinar, A. and Schwabe, K. (eds.) 2015. Handbook of Water Economics. Cheltenham–Northampton, Edward Elgar. Dinar, A. and Tsur, Y. 2021. The Economics of Water Resources: A Comprehensive Approach. Cambridge, Cambridge University Press. Fecht, S. 2019. How Climate Change Impacts our Water. News from the Columbia Climate School. New York, Columbia University. https://news.climate. columbia.edu/2019/09/23/climate-change-impacts- water/ Grafton, R.Q., Libecap, G.D., McGlennon, S., Landry, C. and O’Brien, B. 2011. Determinants of the economic impacts of water restrictions in Australia. Water Resources Research 47. (10): 10504. Gurdak, J.J. 2017. Groundwater: Climate-induced pumping. Nature Geosciences 10. (2): 71–72. Pacific Institute 2010. World Water Quality Facts and Statistics. https://pacinst.org/wp-content/up- loads/2013/02/water_quality_facts_and_stats3.pdf. Russo, T.A. and Lall, U. 2017. Depletion and response of deep groundwater to climate-induced pump- ing variability. Nature Geoscience 10. (2): 105–108. https://doi.org/10.1038/ngeo2883 Thomas, B.F. and Famiglietti, J.S. 2019. Identifying climate-induced groundwater depletion in GRACE observations. Scientific Reports 9. (1): 4124. https:// doi.org/10.1038/s41598-019-40155-y Watson, L., Straatsman, M.W., Wanders, N., Verstegen, J.A., De Jong, S.M. and Karssenberg, D. 2020. Global ecosystem service values in climate class transitions. Environmental Research Letters 15. (2): 024008. https://doi.org/10.1088/1748-9326/ ab5aab http://dx.doi.org/10.1029/2003WR002838 http://dx.doi.org/10.1038/ngeo2883 Peter Adanu Worlasi: Dinar, A.: Advanced Introduction to Water Economics and Policy. Cheltenham–Northampton, Edward Elgar, 2022. 132 p. Hungarian Geograpical Bulletin Vol 74 Issue 2 221-224