James Roumasset

Payments for Watershed Services as Adaptation to Climate Change: Upstream Conservation and Downstream Aquifer Management

January 1, 2015

Economically optimal groundwater extraction allocates water over space and time to its highest and best social use. But optimal management of water resources also requires optimal investment in watershed capital, even as the climate is changing. We augment a standard coastal groundwater management model with stock-dependent extraction costs to include recharge-enhancing natural and produced capital […]

Read More

Energy, Backstop Endogeneity, and the Optimal Use of Groundwater

October 1, 2014

To meet the growing demand for freshwater, many regions have increased groundwater pumping in recent years, resulting in declining groundwater levels worldwide. A promising development to address these declines is technical change regarding groundwater substitutes such as desalination and wastewater recycling. However, because these technologies are energy intensive, optimal implementation also depends on future energy […]

Read More

Incentivizing interdependent resource management: watersheds, groundwater, and coastal ecology

June 9, 2014

Managing water resources independently may result in substantial economic losses when those resources are interdependent with each other and with other environmental resources. We first develop general principles for using resources with spillovers, including corrective taxes (subsidies) for incentivizing private resource users. We then analyze specific cases of managing water resources, in particular the interaction […]

Read More

Groundwater Economics without Equations

June 6, 2014

In many parts of the world, irrigation and groundwater consumption are largely dependent on groundwater. Minimizing the adverse effects of water scarcity requires optimal as well as sustainable groundwater management. A common recommendation is to limit groundwater extraction to maximum sustainable yield (MSY). Although the optimal welfare-maximizing path of groundwater extraction converges to MSY in […]

Read More

Optimal Joint Management of Interdependent Resources: Groundwater vs. Kiawe (Prosopis pallida)

June 4, 2014

Local and global changes continue to influence interactions between groundwater and terrestrial ecosystems. Changes in precipitation, surface water, and land cover can affect the water balance of a given watershed, and thus affect both the quantity and quality of freshwater entering the ground. Groundwater management frameworks often abstract from such interactions. However, in some cases, […]

Read More

The Good, Bad, and Ugly of Watershed Management

Efficient management of groundwater resource systems requires careful consideration of relationships — both positive and negative — with the surrounding environment. The removal of and protection against “bad” and “ugly” natural capital such as invasive plants and feral animals and the enhancement of “good” capital (e.g. protective fencing) are often viewed as distinct management problems. […]

Read More

Intergenerational equity with individual impatience in a model of optimal and sustainable growth

May 1, 2014

Among the ethical objections to intergenerational impartiality is the violation of consumer sovereignty given that individuals are impatient. We accommodate that concern by distinguishing intra- and inter-generational discounting in an overlapping generations model suitable for analyzing sustainability issues.

Read More

Ordering Extraction from Multiple Aquifers

November 26, 2013

Optimal groundwater extraction satisfies the condition that the marginal benefits of water consumption equal the full marginal cost of extraction in each period, including the opportunity cost of future benefits foregone. But how should this well-known condition be generalized when there are multiple aquifers available? We provide an extension of the “Pearce equation” to guide […]

Read More

Integrating Demand-Management with Development of Supply-Side Substitutes

Sustaining water availability at current prices in the face of growing demand and declining resources is not possible, and scarcity is further exacerbated by falling recharge levels due to natural hazard resilience, urbanization, and watershed depreciation. We discuss an integrated approach to water-resource development based on principles of sustainability science. In addition to demand management […]

Read More