Hydro-Economic Analysis for Sustainable Groundwater Management
UC Davis and R.M. Gailey Consulting Hydrogeologist
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In addition to hydrology, elements critical for the sustainable management of groundwater include aspects of economics, engineering, finance, law and politics. Economic analysis will play a significant role and can be combined with hydrogeologic analysis to create useful management formulations. Important considerations with regard to groundwater are: 1) that it exists as a common-pool resource with open access, 2) the magnitude of pumping and scarcity costs, 3) demands (individual, aggregate and hardening), 4) the potential value of markets in counteracting the negative effects of regulation and 6) pumping taxes. This presentation addresses these points from the perspective of agricultural production and within the general context of California’s Sustainable Groundwater Management Act.