ABSTRACT
ABSTRACT: Over the past decades, water markets have been suggested as a policy instrument to provide water sustainability and efficiency, also becoming an effective and relevant mechanism in addressing water-shortage problems in some arid and semi-arid regions of Australia, California and Chile. In Spain, Law 46/1999 incorporated formal water markets into the Spanish legal and regulatory framework in 1999, allowing spot water markets and the creation of water banks. Despite the low number of water transfers and users participating in water markets, the volume of water traded in each transfer was significant. In fact, in some river basins the water trading activity recorded added up to 5.0% of their water use during droughts. This paper shows the potential barriers that have affected water market performance in Spain as well as some guidelines to how to overcome those obstacles.
