ABSTRACT
Freshwater is fast approaching over-allocation in many catchments in New Zealand [NZ] and regional councils are struggling to cope with the outdated, fi rst-come fi rst served principle of allotment enacted by the 1991 Resource Management Act (Land and Water Forum 2011). In all likelihood, some sort of demand management is going to be required to encourage effi ciency of use among competing users, through instruments such as tariffs or regulated water markets. Either system will effectively raise the cost of water to users. Whichever system wins governmental support, it will require understanding of water users’ responses to such increases. While this paper does not attempt to champion any particular method of solving the problem of water allocation, it does attempt to answer the question of response to changes in water cost to NZ’s largest consumptive freshwater users-dairy farmers.
