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Agricultural Water Trading Restrictions and Drought Resilience

Agricultural Water Trading Restrictions and Drought Resilience <p>ABSTRACT:</p><p>Policies that seek to reduce groundwater open-access externalities may be in conflict with the facilitation of water trading during droughts. Using panel data on cropland values, we examine this interaction in the context of groundwater export restrictions. We find that land subject to restrictions experienced a relative decline of 34% ($2,057/acre, roughly half of foregone potential water sales revenue) during the drought immediately following implementation of the policies. During a later, more severe drought, there is no difference in value. Our empirical approach also provides novel estimates of the value of changes in groundwater stock.</p> http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Land Economics University of Wisconsin Press

Agricultural Water Trading Restrictions and Drought Resilience

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Publisher
University of Wisconsin Press
Copyright
Copyright by the Board of Regents of the University of Wisconsin System.
ISSN
1543-8325

Abstract

<p>ABSTRACT:</p><p>Policies that seek to reduce groundwater open-access externalities may be in conflict with the facilitation of water trading during droughts. Using panel data on cropland values, we examine this interaction in the context of groundwater export restrictions. We find that land subject to restrictions experienced a relative decline of 34% ($2,057/acre, roughly half of foregone potential water sales revenue) during the drought immediately following implementation of the policies. During a later, more severe drought, there is no difference in value. Our empirical approach also provides novel estimates of the value of changes in groundwater stock.</p>

Journal

Land EconomicsUniversity of Wisconsin Press

Published: Oct 14, 2019

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