Pricing the elixir of life is a difficult task

Some big cities in China are about to raise the price of water in their effort to conserve the precious natural resource. At a recent conference aimed at promoting the economic use of water in Beijing, Cheng Jing, head of the capital's water resources bureau, said the city would draw up its price-rise plan in the next two months.

Shanghai, Shenyang, capital of Liaoning province, and some other big cities, too, are planning to increase the price of water.

Since the water table in many Chinese cities is falling and water supply is dwindling, the authorities have good reason to raise the price. But just like for other public products, a purely administrative pricing regulation is not the answer to the problem. Instead, establishing a set of timely industrial pricing mechanisms could be the key to solving the problem and offering a way of reforming the long-ticklish pricing system for resources.