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Current Issues in the Economics of Groundwater Resource Management

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  • Phoebe Koundouri

Abstract

The issue of groundwater management remains a practical concern in many regions throughout the world, while water managers continue to grapple with the question of how to manage this resource. In this article, we attempt to bring the most advanced and appropriate tools to bear on the issue of resource allocation involving groundwater. Our objective is to demonstrate the state of the art in the literature on ways to think about this complex resource and to deal with the important economic issues emanating from its complexity. We present the conceptual framework within which economists examine the elements interacting in the management of groundwater resources, indicate why the role of the market is limited with respect to the price of this very complex resource, and point to the mechanisms that can pull competitive groundwater price and quality-graded quantity of groundwater in line with their equilibrium levels. In particular, we critically review economic models of groundwater use, examine the potential for groundwater management, discuss the difficulties encountered in the estimation of the relevant control variables of such models, and identify the advantages and limitations of the instruments devised for the efficient use (allocation) of this resource. Finally, we argue that devised regulatory schemes usually ignore the information and knowledge needed for their implementation, and we suggest a core of conditions necessary for successful groundwater management reforms. Copyright Blackwell Publishers Ltd, 2004.

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Article provided by Wiley Blackwell in its journal Journal of Economic Surveys.

Volume (Year): 18 (2004)
Issue (Month): 5 (December)
Pages: 703-740

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Handle: RePEc:bla:jecsur:v:18:y:2004:i:5:p:703-740

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Citations

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Cited by:
  1. Koundouri, Phoebe & Christou, Christina, 2006. "Dynamic adaptation to resource scarcity and backstop availability: theory and application to groundwater," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 50(2), June.
  2. Zekri, Slim, 2008. "Using economic incentives and regulations to reduce seawater intrusion in the Batinah coastal area of Oman," Agricultural Water Management, Elsevier, vol. 95(3), pages 243-252, March.
  3. Carmen Marchiori & Susan Sayre & Leo Simon, 2012. "Bargaining and Devolution in the Upper Guadiana Basin," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 51(3), pages 453-470, March.
  4. Alain Ayong Le Kama & Agnès Tomini, 2012. "Water Conservation versus Soil Salinity Control," EconomiX Working Papers 2012-8, University of Paris West - Nanterre la Défense, EconomiX.
  5. James Roumasset & Christopher Wada, 2012. "The Economics of Groundwater," Working Papers 201211, University of Hawaii at Manoa, Department of Economics.
  6. Saak, Alexander E. & Peterson, Jeffrey M., 2006. "Groundwater Use under Incomplete Information," 2006 Annual meeting, July 23-26, Long Beach, CA 21190, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  7. Katrin Erdlenbruch & Raphael Soubeyran & Mabel Tidball & Agnes Tomini, 2012. "(Anti-)Coordination Problems with Scarce Water Resources," Working Papers 12-28, LAMETA, Universtiy of Montpellier, revised Sep 2012.
  8. Cobourn, Kelly M., 2011. "Dynamic Feedback between Surface and Groundwater Systems: Implications for Conjunctive Management," 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania 103893, Agricultural and Applied Economics Association.
  9. Jaghdani, Tinoush Jamali & Brummer, Bernhard, 2011. "Demand for Irrigation Water for Pistachio Production from Depleting Groundwater Resources: Spatial Econometric Approach," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114457, European Association of Agricultural Economists.
  10. James Roumasset & Christopher Wada, 2012. "A theory of payment for ecosystem services (PES) pricing consistent with dynamic efficiency and sustainable income requires optimized shadow prices. Since ecosystem services are generally interdepende," Working Papers 2012-7, University of Hawaii Economic Research Organization, University of Hawaii at Manoa.
  11. Esteban, Encarna & Albiac, José, 2011. "Groundwater and ecosystems damages: Questioning the Gisser-Sánchez effect," Ecological Economics, Elsevier, vol. 70(11), pages 2062-2069, September.
  12. Blanco-Gutiérrez, Irene & Varela-Ortega, Consuelo & Flichman, Guillermo, 2011. "Cost-effectiveness of groundwater conservation measures: A multi-level analysis with policy implications," Agricultural Water Management, Elsevier, vol. 98(4), pages 639-652, February.
  13. Jia, Xiangping & Piotrowski, Stephan, 2006. "Land property, tenure security and credit access: a historical perspective of change processes in China," Research in Development Economics and Policy (Discussion Paper Series) 9083, Universitaet Hohenheim, Department of Agricultural Economics and Social Sciences in the Tropics and Subtropics.
  14. Athanasios Kampas & Anna Vasilaki & Athanasios Petsakos & Angeliki Stefopoulou, 2013. "Irrigation Full Cost Assessment: The case of the Pinios Local Organization for Land Reclamation, Greece," Working Papers 2013-1, Agricultural University of Athens, Department Of Agricultural Economics.
  15. Katia Karousakis & Phoebe Koundouri, . "A Typology of Economic Instruments and Methods for Efficient Water Resources Management in Arid and Semi-Arid Regions," DEOS Working Papers 0603, Athens University of Economics and Business.
  16. Phoebe Koundouri & Nikos Papandreou & Kyriaki Remoundou & Yiannis Kountouris, 2013. "A Bird s Eye View of the Greek Water Situation: The Potential for the Implementation of the EU WFD," DEOS Working Papers 1309, Athens University of Economics and Business.
  17. Lenouvel, Vincent & Montginoul, Marielle, 2010. "Groundwater Management Instruments in a Conjunctive Use System: Assessing the Impact on Farmers’ Income Using Mixed Integer Linear Programming (MILP)," Journal of International Agricultural Trade and Development, Journal of International Agricultural Trade and Development, vol. 59(3).

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