Economic policy instruments (EPI) have received widespread attention over the last three decades, and have increasingly been implemented to achieve environmental policy objectives. However, whereas EPI have been successfully applied in some policy domains (such as climate, energy and air quality), their application to tackle water management issues (drought/water scarcity, floods, water quality control) are beset by many practical difficulties. EPI-Water sets to assess the effectiveness and the efficiency of Economic Policy Instruments in achieving water policy goals, and to identify the preconditions under which they complement or perform better than alternative (e.g. regulatory or voluntary) policy instruments. Using a common multi-dimensional assessment framework, the project will compare the performance of single economic instruments or their apposite combinations with the performance otherwise achievable with regulatory (command & control) interventions (such as water restriction/rationing, licensing or permitting), persuasive instruments or voluntary commitments.