CQU Sydney academics David Fox and Noel Ross have contributed an article titled 'Water is Too Cheap' for the Economics Society of Australia (NSW Branch) newsletter.

Dr Fox, senior lecturer in economics and finance, and lecturer Noel Ross provided a detailed outline on the scarcity of water in Australia and ways to solve this limited supply.

Describing the circumstances as one of the most important issues facing Australia’s future, Fox and Ross believe that water is a scarce resource, despite it being regarded as free and of unlimited supply.

The main concern in the article is that water in Australia is too cheap, especially when compared with water costs in other developed countries around the world.

“The purpose of the article is to highlight that water is currently not valued and is regarded as a free resource of unlimited supply," Dr Fox said.

He also asserts that various external factors have been disregarded in the pricing.

"Part of the solution is to correctly value water by including all externalities,” Dr Fox said.

Fox and Ross see economics as the means to solving this problem through the price mechanism.

The article goes on to make clear the need to amend the pricing of water.

“Increasing price causes movement up the demand curve, decreasing quantity demanded...water has a low price elasticity of demand, so a substantial increase in price is required," Dr Fox said.

“This is an example of classical economics addressing an important real-world problem which students can relate too," he said.

At CQU Sydney International Campus, there are 6 doctoral and 6 master’s level academics conducting research in a variety of economic and finance areas which are relevant to the teaching of international students.

Photos: Dr Fox (above) and Dr Ross (below).