When a groundwater basin is exploited by a large number of farmers, acting independently, each farmer has little incentive to practice conservation that would primarily benefit other farmers. This can lead to excessive groundwater extraction. When farmers pay less than the full cost of electricity used for groundwater pumping, this problem can be worsened; while the problem can be somewhat relieved by rationing the electricity supply. The research...
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INFORMATION
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2010/12/01
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Document de travail de recherche sur les politiques
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WPS5494
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1
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1
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2010/12/01
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Disclosed
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The full economic cost of groundwater extraction
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groundwater
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