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Empirical Assessment of the quantity-quality tradeoff for the Ogallala: A case study from West Texas

Listed author(s):
  • Sanchari Ghosh


    (Oklahoma State University)

  • Keith Willett


    (Oklahoma State University)

Registered author(s):

    The High Plains region in West Texas has been the focus of water conservation policies for the last two decades because of rapid depletion of groundwater in this region. Groundwater is the only source of irrigation in this region of Texas with Ogallala serving as the major aquifer. In recent times, however, attent ion has been drawn on nitrate pollution of the Ogallala aquifer, though no study or research report has come up with a joint management solution to cope with both of these problems. This research attempts to fill this gap, taking the rural county of Castro as a case study. The main objective is to make an empirical assessment of this tradeoff by capturing the dynamic behavior of the stock of groundwater as well as the stock of pollutant over a twenty year period. Two sets of policies are developed to control the impact of excess fertilizer use on the groundwater and to evaluate the effect on the net present value of production. First a constraint is imposed on the use of nitrogen fertilizer per acre; second, the price of nitrogen fertilizer is raised successively by 5% and 10%. Secondly, certain policies aimed at raising the volume of water in storage such as restricting the use of irrigation water by around 0.50 acre-inch per acre from the base solution as well as buying out water rights also show positive results in terms of water quantity and quality. Restriction on the terminal value of saturated thickness (or the water table) as well as buying out water rights show a 7 and 4 mg/l increase in the stock of pollutant with a saturated thickness decline by 6 feet less than the base level.

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    Paper provided by Oklahoma State University, Department of Economics and Legal Studies in Business in its series Economics Working Paper Series with number 1201.

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    Length: 42 pages
    Date of creation: 2012
    Handle: RePEc:okl:wpaper:1201
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    1. Fleming, R. A. & Adams, R. M., 1997. "The Importance of Site-Specific Information in the Design of Policies to Control Pollution," Journal of Environmental Economics and Management, Elsevier, vol. 33(3), pages 347-358, July.
    2. Roseta-Palma, Catarina, 2002. "Groundwater Management When Water Quality Is Endogenous," Journal of Environmental Economics and Management, Elsevier, vol. 44(1), pages 93-105, July.
    3. Nkonya, Ephraim M. & Featherstone, Allen M., 2000. "Determining Socially Optimal Nitrogen Application Rates Using A Delayed Response Model: The Case Of Irrigated Corn In Western Kansas," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 25(02), December.
    4. Catarina Roseta-Palma, 2003. "Joint Quantity/Quality Management of Groundwater," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 26(1), pages 89-106, September.
    5. Naomi Zeitouni & Ariel Dinar, 1997. "Mitigating negative water quality and quality externalities by joint mangement of adjacent aquifers," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 9(1), pages 1-20, January.
    6. Gisser, Micha, 1983. "Groundwater: Focusing on the Real Issue," Journal of Political Economy, University of Chicago Press, vol. 91(6), pages 1001-1027, December.
    7. Glen D. Anderson & James J. Opaluch & W. Michael Sullivan, 1985. "Nonpoint Agricultural Pollution: Pesticide Contamination of Groundwater Supplies," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 67(5), pages 1238-1243.
    8. Satya N. Yadav, 1997. "Dynamic Optimization of Nitrogen Use When Groundwater Contamination Is Internalized at the Standard in the Long Run," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(3), pages 931-945.
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