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<br />. <br /> <br />. <br /> <br />~ <br />o <br />o <br />CO <br /> <br />. <br /> <br />'. <br /> <br />. <br /> <br />. <br /> <br />. <br /> <br />. <br /> <br />. <br /> <br />. <br /> <br />. <br /> <br />to bargain for their constituents. These bargaining decisions may well <br /> <br />move water use toward the socially optimal position if all constituents <br /> <br />are fairly represented and a me'chanism for making payments to alter <br /> <br />pollution behavior could be conceived and implemented. 7 History, <br /> <br />however, does not provide us with many examples of where this kind of <br /> <br />bargaining has been successful. Let us now turn to public penalties that <br /> <br />might be imposed on irrigators or others that inflict external costs on <br /> <br />others. <br /> <br />Perhaps the most straight forward type of economic sanction is a <br /> <br />user surcharge or tax on water use. If this surcharge were placed on <br /> <br />each unit of water diverted, the MNB curve of Figure VI-l would shift <br /> <br />downward and to the left by the amount of the surcharge. Obviously, if <br /> <br />the positions of MNB and OA were known, the surcharge could be set <br />e <br /> <br />at the level which would produce a private optimum at OA units ,of water <br />e <br /> <br />use. The irrigator would respond to this surcharge in those ways which <br /> <br />would affect his profit position least unfavorably. His management would <br /> <br />be more flexible in responding to a water surcharge than to a water quality <br /> <br />standard or quantity quota. <br /> <br />A tax surcharge on water utili"ed by Upper Basin irrigators would mean <br /> <br />that they would be required to bear the costs for providing benefits to <br /> <br />downstream users. This may be inequitable. The beneficiaries may <br /> <br />be asked to help pay for these benefits. They could be required to pay <br /> <br />17 <br />