Search

This paper explores the potential of applying a newly developed risk trading system, the so-called 'tradeable flood mitigation permit', to international flood management. Trading, aimed at complementing binding agreements or regulations, offers a new approach to transnational collaboration. A case study on the Dutch and German River Rhine is presented. The principle of internalising externalities using direct financial means is applied. The expected result is a higher level of river basin management in the upstream area, with financial resources coming from downstream. Specific institutional conditions, at both national and international levels, are identified in order to facilitate the establishment of the transactions. [ABSTRACT FROM AUTHOR]