Social and Behavioral Sciences Commons^™

Groundwater Depletion In India: Social Losses From Costly Well Deepening, Susan Stratton Sayre, Vis Taraz

Economics: Faculty Publications

We develop a dynamic groundwater model that incorporates both groundwater pumping and investment in deeper wells and apply the model to the arid, alluvial aquifer region of Northern India that is experiencing rapid depletion. We compute the potential benefits of regulating groundwater use by comparing the net benefits of groundwater under optimal management to the net benefits under a common pool regime with two different cost structures: one with flat electricity tariffs, which are widespread in India, and a second with full marginal cost electricity pricing. Using numerical simulation, we find that the opportunity to invest in deeper wells significantly …