IDEAS home Printed from https://ideas.repec.org/a/spr/waterr/v34y2020i8d10.1007_s11269-020-02552-1.html
   My bibliography  Save this article

The Welfare Implications of Bankruptcy Allocation of the Colorado River Water: The Case of the Salton Sea Region

Author

Listed:
  • Jacob Rightnar

    (University of California)

  • Ariel Dinar

    (University of California)

Abstract

This paper focuses on assessing a policy for reallocation of Colorado River water for major stakeholders in the state of California, to set a standard for sustainable long-term public and environmental use. We address the policy of allocating scarce water resources to competing stakeholders of different sectors in the Salton Sea region under over-committed water rights agreement. We determine the value of water applied to the agricultural, urban and tourist sectors to estimate the regional welfare under different allocation frameworks. We use two models for allocation: one involving a social planner approach that maximizes regional welfare, the second focusing on the bankruptcy rules of proportional deficit (cutback), and constrained equal award. We find the proportional cutback framework to be less conducive to regional welfare, although it presents a more politically feasible and robust option.

Suggested Citation

  • Jacob Rightnar & Ariel Dinar, 2020. "The Welfare Implications of Bankruptcy Allocation of the Colorado River Water: The Case of the Salton Sea Region," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 34(8), pages 2353-2370, June.
    • Handle: RePEc:spr:waterr:v:34:y:2020:i:8:d:10.1007_s11269-020-02552-1
    DOI: 10.1007/s11269-020-02552-1
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11269-020-02552-1
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s11269-020-02552-1?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Nigatu, Getachew & Dinar, Ariel, 2016. "Economic and hydrological impacts of the Grand Ethiopian Renaissance Dam on the Eastern Nile River Basin," Environment and Development Economics, Cambridge University Press, vol. 21(4), pages 532-555, August.
    2. Sarah Acquah & Frank A. Ward, 2017. "Optimizing Adjustments to Transboundary Water Sharing Plans: A Multi-Basin Approach," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 31(15), pages 5019-5042, December.
    3. Aumann, Robert J. & Maschler, Michael, 1985. "Game theoretic analysis of a bankruptcy problem from the Talmud," Journal of Economic Theory, Elsevier, vol. 36(2), pages 195-213, August.
    4. Dagmawi Mulugeta Degefu & Weijun He & Liang Yuan & An Min & Qi Zhang, 2018. "Bankruptcy to Surplus: Sharing Transboundary River Basin’s Water under Scarcity," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 32(8), pages 2735-2751, June.
    5. Rodica Branzei & Giulio Ferrari & Vito Fragnelli & Stef Tijs, 2008. "A Flow Approach to Bankruptcy Problems," Czech Economic Review, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, vol. 2(2), pages 146-153, September.
    6. Dagmawi Mulugeta Degefu & Weijun He, 2016. "Allocating Water under Bankruptcy Scenario," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(11), pages 3949-3964, September.
    7. Booker J. F. & Young R. A., 1994. "Modeling Intrastate and Interstate Markets for Colorado River Water Resources," Journal of Environmental Economics and Management, Elsevier, vol. 26(1), pages 66-87, January.
    8. Kostas Bithas & Chrysostomos Stoforos, 2006. "Estimating Urban Residential Water Demand Determinants and Forecasting Water Demand for Athens Metropolitan Area, 2000-2010," South-Eastern Europe Journal of Economics, Association of Economic Universities of South and Eastern Europe and the Black Sea Region, vol. 4(1), pages 47-59.
    9. Ronald C. Griffin & James W. Mjelde, 2000. "Valuing Water Supply Reliability," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(2), pages 414-426.
    10. Giovanni Sechi & Riccardo Zucca, 2015. "Water Resource Allocation in Critical Scarcity Conditions: A Bankruptcy Game Approach," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 29(2), pages 541-555, January.
    11. Dinar, Shlomi & Katz, David & De Stefano, Lucia & Blankespoor, Brian, 2014. "Climate change, conflict, and cooperation : global analysis of the resilience of international river treaties to increased water variability," Policy Research Working Paper Series 6916, The World Bank.
    12. Daniel Crespo & Jose Albiac & Taher Kahil & Encarna Esteban & Safa Baccour, 2019. "Tradeoffs between Water Uses and Environmental Flows: A Hydroeconomic Analysis in the Ebro Basin," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 33(7), pages 2301-2317, May.
    13. Ershad Oftadeh & Mojtaba Shourian & Bahram Saghafian, 2016. "Evaluation of the Bankruptcy Approach for Water Resources Allocation Conflict Resolution at Basin Scale, Iran’s Lake Urmia Experience," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(10), pages 3519-3533, August.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Zachary Darby & Neelam Chandra Poudyal & Adam Frakes & Omkar Joshi, 2021. "Economic Analysis of Recreation Access at a Lake Facing Water Crisis due to Municipal Water Demand," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 35(9), pages 2909-2920, July.
    2. Carlos Gutiérrez-Martín & José A. Gómez-Limón & Nazaret M. Montilla-López, 2022. "Priority Water Rights for Irrigation at the River Basin Level. Do They Improve Economic Efficiency During Drought Periods?," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 36(10), pages 3737-3758, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yang Zheng & Xuefeng Sang & Zhiwu Liu & Siqi Zhang & Pan Liu, 2022. "Water Allocation Management Under Scarcity: a Bankruptcy Approach," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 36(9), pages 2891-2912, July.
    2. Dagmawi Mulugeta Degefu & Weijun He & Liang Yuan, 2017. "Monotonic Bargaining Solution for Allocating Critically Scarce Transboundary Water," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 31(9), pages 2627-2644, July.
    3. Erik Ansink & Hans-Peter Weikard, 2012. "Sequential sharing rules for river sharing problems," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 38(2), pages 187-210, February.
    4. Rahmi İlkılıç & Çağatay Kayı, 2014. "Allocation rules on networks," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 43(4), pages 877-892, December.
    5. Carlos Gutiérrez-Martín & José A. Gómez-Limón & Nazaret M. Montilla-López, 2022. "Priority Water Rights for Irrigation at the River Basin Level. Do They Improve Economic Efficiency During Drought Periods?," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 36(10), pages 3737-3758, August.
    6. Gustavo Bergantiños & Jose María Chamorro & Leticia Lorenzo & Silvia Lorenzo‐Freire, 2018. "Mixed rules in multi‐issue allocation situations," Naval Research Logistics (NRL), John Wiley & Sons, vol. 65(1), pages 66-77, February.
    7. Dagmawi Mulugeta Degefu & Weijun He, 2016. "Allocating Water under Bankruptcy Scenario," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(11), pages 3949-3964, September.
    8. Giovanni Sechi & Riccardo Zucca, 2015. "Water Resource Allocation in Critical Scarcity Conditions: A Bankruptcy Game Approach," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 29(2), pages 541-555, January.
    9. Thomson, William, 2015. "Axiomatic and game-theoretic analysis of bankruptcy and taxation problems: An update," Mathematical Social Sciences, Elsevier, vol. 74(C), pages 41-59.
    10. Mehdi Kazemi & Omid Bozorg-Haddad & Elahe Fallah-Mehdipour & Xuefeng Chu, 2022. "Optimal water resources allocation in transboundary river basins according to hydropolitical consideration," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(1), pages 1188-1206, January.
    11. Emin Karagözoğlu, 2014. "A noncooperative approach to bankruptcy problems with an endogenous estate," Annals of Operations Research, Springer, vol. 217(1), pages 299-318, June.
    12. William Thomson, 2007. "On the existence of consistent rules to adjudicate conflicting claims: a constructive geometric approach," Review of Economic Design, Springer;Society for Economic Design, vol. 11(3), pages 225-251, November.
    13. Gabrielle Demange & Michel L. Balinski, 1989. "An Axiomatic Approach to Proportionality between Matrices," Post-Print halshs-00670952, HAL.
    14. Ketelaars, Martijn & Borm, Peter & Herings, P.J.J., 2023. "Duality in Financial Networks," Other publications TiSEM 26750293-9599-4e05-9ae1-8, Tilburg University, School of Economics and Management.
    15. Hu, Zhineng & Chen, Yazhen & Yao, Liming & Wei, Changting & Li, Chaozhi, 2016. "Optimal allocation of regional water resources: From a perspective of equity–efficiency tradeoff," Resources, Conservation & Recycling, Elsevier, vol. 109(C), pages 102-113.
    16. Erlanson, Albin & Szwagrzak, Karol, 2013. "Strategy-Proof Package Assignment," Working Papers 2013:43, Lund University, Department of Economics.
    17. Peter Knudsen & Lars Østerdal, 2012. "Merging and splitting in cooperative games: some (im)possibility results," International Journal of Game Theory, Springer;Game Theory Society, vol. 41(4), pages 763-774, November.
    18. Juan Moreno-Ternero & Antonio Villar, 2006. "The TAL-Family of Rules for Bankruptcy Problems," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 27(2), pages 231-249, October.
    19. Cano Berlanga, Sebastian & Giménez Gómez, José M. (José Manuel) & Vilella Bach, Misericòrdia, 2015. "Enjoying cooperative games: The R package GameTheory," Working Papers 2072/247653, Universitat Rovira i Virgili, Department of Economics.
    20. Juarez, Ruben & Ko, Chiu Yu & Xue, Jingyi, 2018. "Sharing sequential values in a network," Journal of Economic Theory, Elsevier, vol. 177(C), pages 734-779.

    More about this item

    Keywords

    Colorado River water; Salton Sea; Water scarcity; Bankruptcy allocation; Regional welfare; Sectoral equity; Social planner;
    All these keywords.

    JEL classification:

    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:waterr:v:34:y:2020:i:8:d:10.1007_s11269-020-02552-1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.