Department of Economics, University of Foggia, Largo Papa Giovanni Paolo II,1, 71121 – Foggia, Italy
Over the last decades, groundwater irrigation has become commonplace in many regions worldwide. This is largely a consequence of the advances in drilling and pumping technologies and of the development of hydrogeology. Compared with traditional surface water irrigation systems, groundwater irrigation offers more reliable supplies, lesser vulnerability to droughts, and ready accessibility for individual users. However, poor groundwater management and legal controversies are currently at the base of social disputes in the water exploitation. A through and transparent assessment of the relative socio-economic value of groundwater can contribute to mitigate or avoid potential conflicts. In this paper, we develop a mathematical model that studies the exploitation of a common groundwater resource in order to take into account the strategic and dynamic interactions among the users of the resource. It is known that a number of different factors may increase the welfare gains of firms but also cause the overexploitation of the aquifer. The aim of the model is to analyze policy options and economic forces that influence the groundwater irrigation sector and its development.
Groundwater extraction, Agriculture, differential games.
- Biancardi, M. and L. Maddalena (2018). Competition and cooperation in the exploitation of the groundwater resource. Decision in Economics and Finance. 41 (2), 219-237,2018.
- Brown, G.M. (2000). Renewable natural resource management and use without markets. Journal of Economic Literature, Vol. 38(4), 875914.
- Burke, J. (2003). Groundwater for irrigation: productivity gains and the need to manage hydro-environmental risk. Llamas, M. R. and Custodio, E., editors, Intensive Use of Groundwater. Challenges and Opportunities, chapter 3, Taylor and Francis, Vol. 59-80.
- Esteban, E. and J. Albiac, (2011). Groundwater and ecosystems damages: Questioning the Gisser-Sanchez effect. Ecological Economics, Vol. 70, 2062-2069.
- Gisser, M. and D.A. Sanchez, (1980). Competition versus optimal control in groundwater pumping. Water Resources Research, Vol. 16, 638-642.
- Koundouri, P. (2004). Current issues in the economics of groundwater resource manage-ment. Journal of Economic Surveys, Vol. 18(5), 703-740.
- Koundouri, P. and A. Xepapadeas, (2004). Estimating accounting price for common pool natural resources: a distance function approach. Water Resources Research, Vol. 40(6).
- Negri, D.H. (1989). The common property aquifer as a differential game. Water Resources Research, Vol. 25, 9-15.
- Provencher, B. and O. Burt, (1993). The externalities associated with the Common Property Exploitation of groundwater. Journal of Environmental Economics and Management, Vol. 24, 139-158.
- Rubio, S. J. and B. Casino, (2001). Competitive versus efficient extraction of a common property resource. The groundwater case. Journal of Economics Dynamics and Control, Vol. 25, 1117-11137.
- Rubio, S. J. and B. Casino, (2003). Strategic Behavior and efficiency in the common prop-erty extraction of groundwater. Environmental and Resource Economics, Vol. 26, 73-87.