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Chapter 9 Replenishable But Depletable Resources: Water 9.1 Introduction Main contents: Examining the likelihood and severity of water scarcity Defining the efficient allocation of ground and surface water over time and comparing these allocation to current practice Examining the menu of opportunities for meaningful institutional reform 9.2 The Potential For Water Scarcity Two rather different sources of available water supplies: Surface water which consists of the fresh water in rivers, lakes, and reservoirs that collects and flows on the earth’s surface. Groundwater which collects in porous layers of underground rock known as acquifers. 9.2 The Potential For Water Scarcity To water scarcity, quantity of water is not the only problem. Quality is also a problem. 9.3 The Efficient Allocation of Scarce Water What efficiency means for the allocation of water depends crucially on whether surface water or groundwater is being tapped. In the absence of storage, the problem with surface water is to allocate a renewable supply among competing users. Intergenerational effects are less important as future supplies depend on natural phenomena (such as precipitation) rather than on current withdraw practices. For groundwater, on the other hand, withdrawing water now does affect the resources available to future generations. In this case, the allocation over time is a crucial aspect of the analysis. 9.3 The Efficient Allocation of Scarce Water An efficient allocation of surface water: Must strike a balance among a host of competing users Must supply an acceptable means of handling the year-to-year variability in surface water flow. 9.3 The Efficient Allocation of Scarce Water How to strike a balance among a host of competing users? The water should be allocated so that the marginal net benefit is equlized for all uses. Figure 10.2 9.3 The Efficient Allocation of Scarce Water How to deal with fluctuations in supply? As long as the supply level can be anticipated, the equal ma
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