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Groundwater management under heterogeneous land tenure arrangements

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  • Nasim, Sanval
  • Helfand, Steven
  • Dinar, Ariel

Abstract

We develop a groundwater extraction model that considers the Marshallian inefficiency associated with sharecropping and use data from Pakistan to simulate the impact of an open access regime and of optimal management on groundwater extractions, the state of the aquifer, and annual net benefits through time. We also evaluate a price instrument as a mechanism of inducing optimal extractions. Under both open access and optimal management, we observe notable differences in groundwater extractions and the water table level between the tenure model (which considers the behavior of both owner cultivators and sharecroppers) and the baseline model (which includes the behavior of only owner cultivators). We also find a modest difference in the aggregate net benefits generated by the two models. The results offer new insights—vis-à-vis land tenure heterogeneity—into the evaluation of more effective policies for groundwater management and aquifer sustainability.

Suggested Citation

  • Nasim, Sanval & Helfand, Steven & Dinar, Ariel, 2020. "Groundwater management under heterogeneous land tenure arrangements," Resource and Energy Economics, Elsevier, vol. 62(C).
    • Handle: RePEc:eee:resene:v:62:y:2020:i:c:s0928765520304127
    DOI: 10.1016/j.reseneeco.2020.101203
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    More about this item

    JEL classification:

    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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