Competition and Cooperation in the Exploitation of the Ground Water Resource
Publisher: Decisions in Economics and Finance
Author(s): Marta Biancardi and Lucia Maddalena
Date: 2018
Topics: Conflict Prevention, Cooperation, Extractive Resources, Renewable Resources
We study the exploitation of a common groundwater resource, first as a static and then as a differential game, in order to take into account the strategic and dynamic interactions among the users of the resource. We suppose that firms can form coalitions or can decide not to cooperate. The non-cooperation regime is characterized by pumping that lead to depletion of the aquifer; the cooperation preserves the resource. Open-loop and feedback equilibria have been computed and compared in order to characterize the existence of cooperators and defectors in water resources management.