Dryland salinity in Western Australia is not mainly caused by off-site impacts or economic externalities between farmers as previously thought. Internalizing all salinity-related externalities in WA wouldn't greatly affect farm management. This is due to various factors, like water and economic reasons, reducing the actual severity of these externalities. Although externalities are less significant, resolving salinity issues in a free market isn't straightforward due to other market failures related to research, development, and farmer adoption of treatments. The current policies aren't effectively tackling these issues, and misconceptions about the importance of salinity externalities may be impeding progress in dealing with the problem.