Economics of Water Infrastructure Options to Address Salinity Damage in Western Australian Rural Towns

In Australia, clearing of native vegetation has led to groundwater tables rising, bringing with them naturally occurring salts that degrade agricultural land, broader landscapes and rural town infrastructure. This research examined the economic viability of remedial action, applying cost benefit analysis to a case study in the WA Wheatbelt town of Wagin. Findings suggest that groundwater abstraction, desalination and water sale for reuse is economical, although external costs and benefits were not considered. Externalities and property rights are key in explaining how this situation developed, and how we could learn from history and avoid similar situations in the future.