Ever growing demand for agricultural and municipal water, caused by population growth and the need to feed the world, as well as increasing stress over waterbodies crave for efficient and sustainable water management. Especially in areas where municipal and agricultural water consumption rely on the same water sources for satisfying their water needs, it is important to explore evidence-based policy instruments that achieve sustainable water use in a way that is optimal for both dwellers and farmers concurrently. Some economists regard market-based policy instruments superior to command-and-control instruments in enhancing the economically efficient use of natural resources [1,2]. While some clearly favor market-based instruments in ecosystem management [3,4], such instruments are not the dominant policy strategy for environmental protection [5]. Instead, many authors call for hybrid ins...

Study region The Chancay-Huaral (CH) coastal river basin in the Lima Region, Peru, between the Pacific Ocean and the Andean Cordillera. Study focus Climate change impacts on annual and monthly discharges in the CH Basin are assessed for the future period 2051–2080. Hydrological modeling is sensitive to biases in input variables. Therefore, bias-corrected time series of temperature and precipitation from 31 General Circulation Models (GCMs) with the emission scenarios RCP4.5 and RCP8.5 (Representative Concentration Pathways) were used as inputs for the Water Evaluation and Planning System model (WEAP). Bias correction and downscaling of the GCMs were implemented using a quantile mapping method. New hydrological insights for the region On average, GCMs indicate increased annual mean temperatures by 3.1 °C (RCP4.5) and by 4.3 °C (RCP8.5) and precipitation sum by 20% (RCP4.5) and by 28% ...