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Constrained conjunctive-use for endogenously separable water markets: managing the Waihole-Waikane aqueduct

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  • Smith, Rodney B. W.
  • Roumasset, James

Abstract

An internal solution to an optimal control problem involving conjunctive use of surface and groundwater may be inapplicable if water is not sufficiently fungible across space and time. We provide a more general solution and apply it to the problem of allocating a limited amount of water from the Koolau mountains to two Oahu water districts separated by those mountains. The solution involves initially allocating all the mountain water to the district supplied by groundwater but eventually allocating all of the water to the district supplied by the surface water. The conditions for an internal solution hold only in the intervening years when some mountain water is allocated to each district.

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Bibliographic Info

Article provided by Blackwell in its journal Agricultural Economics.

Volume (Year): 24 (2000)
Issue (Month): 1 (December)
Pages: 61-71

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Handle: RePEc:eee:agecon:v:24:y:2000:i:1:p:61-71

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  1. Darrell Krulce & James A. Roumasset & Tom Wilson, 1997. "Optimal Management of a Renewable and Replaceable Resource: The Case of Coastal Groundwater," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(4), pages 1218-1228.
  2. Chakravorty Ujjayant & Hochman Eithan & Zilberman David, 1995. "A Spatial Model of Optimal Water Conveyance," Journal of Environmental Economics and Management, Elsevier, vol. 29(1), pages 25-41, July.
  3. Tsur, Yacov & Graham-Tomasi, Theodore, 1991. "The buffer value of groundwater with stochastic surface water supplies," Journal of Environmental Economics and Management, Elsevier, vol. 21(3), pages 201-224, November.
  4. James Moncur & James Roumasset & Rodney Smith, 1997. "Optimal Allocation of Ground and Surface Water in O'ahu: Water Wars in Paradise," Working Papers 199707, University of Hawaii at Manoa, Department of Economics.
  5. James E. T. Moncur & Richard L. Pollock, 1988. "Scarcity Rents for Water: A Valuation and Pricing Model," Land Economics, University of Wisconsin Press, vol. 64(1), pages 62-72.
  6. Roumasset, J. & Isaak, D. & Fesharaki, F., 1983. "Oil prices without OPEC : A walk on the supply-side," Energy Economics, Elsevier, vol. 5(3), pages 164-170, July.
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