IDEAS home Printed from https://ideas.repec.org/a/ags/jlaare/105533.html
   My bibliography  Save this article

The Economics of Commonly Owned Groundwater When User Demand Is Perfectly Inelastic

Author

Listed:
  • Wang, Chenggang
  • Segarra, Eduardo

Abstract

This paper provides a theoretical analysis of the common-pool resource dilemma in extracting nonrenewable groundwater resources when water demand is perfectly inelastic. It complements the existing theory of groundwater use, which assumes away the possibility of demand perfect inelasticity. Under perfectly inelastic water demand, the common-pool resource dilemma is by-passed if groundwater users are equally productive in water use. If they are not, a new type of inefficiency can arise due to the lack of a rationing mechanism on the basis of productivity. Our analysis suggests that groundwater management research should pay more attention to water demand elasticity and productivity heterogeneity.

Suggested Citation

  • Wang, Chenggang & Segarra, Eduardo, 2011. "The Economics of Commonly Owned Groundwater When User Demand Is Perfectly Inelastic," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 36(1), pages 1-26, April.
  • Handle: RePEc:ags:jlaare:105533
    DOI: 10.22004/ag.econ.105533
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/105533/files/JARE_Apr2011__07_pp95-120_Wang.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Marita Laukkanen & Phoebe Koundouri, "undated". "Competition versus coopertion in groundwater extraction: A stochastic framework with heteregoneous agents," DEOS Working Papers 0605, Athens University of Economics and Business.
    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. Kovacs, Kent & Popp, Michael & Xu, Ying & West, Grant, 2016. "Tradeoffs among multiple ecosystem services and economic returns from groundwater depletion on a farm landscape," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235357, Agricultural and Applied Economics Association.
    2. Perry, Gregory M., 2012. "WAEA Presidential Address Deciding Where to Publish: Some Observations on Journal Impact Factor and Article Influence Score," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 37(3), pages 1-14.
    3. Faye, Amy & Msangi, Siwa, 2018. "Rainfall variability and groundwater availability for irrigation in Sub-Saharan Africa: evidence from the Niayes region of Senegal," MPRA Paper 92625, University Library of Munich, Germany.
    4. Kovacs, Kent & Durand-Morat, Alvaro, 2018. "Optimal Groundwater Management in Response to the Intensity of Lateral Flows," 2018 Annual Meeting, February 2-6, 2018, Jacksonville, Florida 267164, Southern Agricultural Economics Association.
    5. Xu, Ying & Kovacs, Kent & Nalley, Lanier & Popp, Michael, 2015. "Investment in on-farm reservoirs to align economic returns and ecosystem services," 2015 Annual Meeting, January 31-February 3, 2015, Atlanta, Georgia 196778, Southern Agricultural Economics Association.
    6. Quintana-Ashwell, Nicolas E. & Peterson, Jeffrey M., 2014. "The Dynamic Impact of Technical Progress on Common-pool Groundwater Use and Depletion," 2015 Annual Meeting, January 31-February 3, 2015, Atlanta, Georgia 196891, Southern Agricultural Economics Association.
    7. Du Bois, Rodrigo Salcedo & Macias, Miguel Angel Gutierrez, 2013. "Cooperation makes it happen? Groundwater management in Aguascalientes, Mexico: An experimental approach," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 151139, Agricultural and Applied Economics Association.
    8. Kovacs, Kent & Mattia, Mancini & Christopher, Henry & Grant, West, 2015. "Spatial irrigation management to sustain groundwater and economic returns," 2015 Annual Meeting, January 31-February 3, 2015, Atlanta, Georgia 196758, Southern Agricultural Economics Association.
    9. Tran, Dat Q. & Kovacs, Kent F. & West, Grant H., 2020. "Spatial economic predictions of managed aquifer recharge for an agricultural landscape," Agricultural Water Management, Elsevier, vol. 241(C).
    10. Quintana-Ashwell, Nicolas E. & Peterson, Jeffrey M., 2015. "Aquifer Depletion in the face of Climate Change and Technical Progress," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205882, Agricultural and Applied Economics Association.
    11. Nicolas E. Quintana Ashwell & Jeffrey M. Peterson, 2016. "The Impact of Irrigation Capital Subsidies on Common-Pool Groundwater Use and Depletion: Results for Western Kansas," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 2(03), pages 1-22, September.
    12. Hendricks, Nathan P. & Peterson, Jeffrey M., 2012. "Fixed Effects Estimation of the Intensive and Extensive Margins of Irrigation Water Demand," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 37(1), pages 1-19, April.
    13. Kim, C.S. & Fuglie, Keith O. & Wallander, Steve & Wechsler, Seth, 2015. "Endogenous Technical Change and Groundwater Management: Revisiting the Gisser-Sanchez Paradox," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205350, Agricultural and Applied Economics Association.
    14. repec:ags:jrapmc:122312 is not listed on IDEAS
    15. Kovacs, Kent & Durand-Morat, Alvaro, 2020. "Lateral flows in an aquifer and groundwater valuation," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304219, Agricultural and Applied Economics Association.
    16. Peterson, Jeffrey M. & Saak, Alexander E., 2013. "Spatial externalities in aquifers with varying thickness: Theory and numerical results for the Ogallala aquifer," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150553, Agricultural and Applied Economics Association.
    17. de Bonviller, Simon & Wheeler, Sarah Ann & Zuo, Alec, 2020. "The dynamics of groundwater markets: Price leadership and groundwater demand elasticity in the Murrumbidgee, Australia," Agricultural Water Management, Elsevier, vol. 239(C).
    18. Fan, Yubing & Park, Seong C., 2018. "A Meta-analysis of Water Conservation Policies in the Southern Ogallala Aquifer Region," 2018 Annual Meeting, February 2-6, 2018, Jacksonville, Florida 266656, Southern Agricultural Economics Association.

    More about this item

    Keywords

    Resource /Energy Economics and Policy;

    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:ags:jlaare:105533. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search). General contact details of provider: http://edirc.repec.org/data/waeaaea.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.