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Nine dragons, one river : the role of institutions in developing water pricing policy in Beijing, PRC Hou, Eve


Water prices in Beijing have experienced growth over the past few years, but remain "cheap" considering the cost of supply and lack of resources. This paper uncovers the role of institutions (defined by formal aspects such as laws, regulation and policies, government departments and hierarchies, and informal aspects such as history, personal and bureaucratic motivation) in determining and implementing water pricing policy and water price reform. While this paper is primarily descriptive, it is formulated as a multiple criteria decision-making analysis. In determining actors and objectives for this analysis, the institutions surrounding the issue of water pricing are explored to understand and describe their function, the incentives they are influenced by, the goals they aim for, and how these goals fit in the wider context of national priorities. Various alternatives derived from water pricing theory are then tested to determine how well they achieve the goals laid out. Through this process we come to the conclusion that the implementation of higher, market-based water prices is inevitable, given the aims of local and national government alike. Further, the rising of water prices correspond with a change in national ideology from communist, egalitarian principles, to market-based, market socialist principles.

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