A Water Agency faced with quantity-quality management of a groundwater resource

Katrin Erdlenbruch, Mabel Tidball () and Georges Zaccour

Working Papers from LAMETA, Universtiy of Montpellier

Abstract: We consider a problem of groundwater management in which a group of farmers over- exploits a groundwater stock and causes excessive pollution. A Water Agency wishes to regulate the farmer's activity, in order to reach a minimum quantity and quality level but it is subject to a budget constraint and cannot credibly commit to time-dependent optimal policies. We construct a Stackelberg game to determine a set of constant policies that brings the groundwater resource back to the desired state. We define a set of conditions for which constant policies exist and compute the amount of these instruments in an example.

Pages: 21 pages
Date: 2012-03, Revised 2012-03
New Economics Papers: this item is included in nep-env, nep-reg and nep-res
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Persistent link: https://EconPapers.repec.org/RePEc:lam:wpaper:12-09

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