D emands on the world’s available freshwater supplies continue to grow as the global population increases. During the 20th century, the global human population increased fourfold to more than six billion. In the same period, water withdrawn from natural freshwater ecosystems increased eightfold (Gleick 1998). In many parts of the world, scarce water supplies are a serious environmental concern, and water is often used at rates that exceed those dictated by the criterion of economic efficiency due to the lack of adequate policy, particularly with respect to pricing (e.g., Worldwatch Institute 1993). For example, in many of the formerly planned economies, water was provided essentially for free; as a result there was no culture of conservation.