Groundwater use under incomplete information

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Show simple item record Saak, Alexander Peterson, Jeffrey M. 2012-10-16T19:52:14Z 2012-10-16T19:52:14Z 2012-10-16
dc.description.abstract This paper introduces a game theoretic model of groundwater extraction in a two-cell aquifer under incomplete information. A novel assumption is that individual users have incomplete knowledge of the speed of lateral flows in the aquifer: although a user is aware that his neighbor’s water use has some influence on his future water stock, he is uncertain about the degree of this impact. We find that the lack of information may either increase or decrease the rate of water use and welfare. In a two-period framework, the relevant characteristic is the ratio of the periodic marginal benefits of water use. Depending on whether this ratio is convex or concave, the average speed with which the aquifer is depleted decreases or increases when users learn more about the local hydrologic properties of groundwater. In principle, welfare may decrease even in cases when the groundwater allocation is closer to the efficient groundwater allocation. en_US
dc.relation.uri en_US
dc.subject Common property resource en_US
dc.subject Groundwater en_US
dc.subject Information en_US
dc.title Groundwater use under incomplete information en_US
dc.type Article (author version) en_US 2007 en_US
dc.citation.doi doi:10.1016/j.jeem.2006.12.005 en_US
dc.citation.epage 228 en_US
dc.citation.issue 2 en_US
dc.citation.jtitle Journal of Environmental Economics and Management en_US
dc.citation.spage 214 en_US
dc.citation.volume 54 en_US
dc.contributor.authoreid jpeters en_US

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