We investigate the behavior of farmers who share an underground aquifer. In the case where seepage may occur the resource is nonexclusive, giving rise to a spatial externality whereby pumping by one user affects others nearby. Theoretically, these externalities are potentially important causes...

Encouraging the use of more efficient irrigation technology is often viewed as an effective, politically feasible method to reduce the consumptive use of water for agricultural production. Despite its pervasive recommendation, it is not clear that increasing irrigation efficiency will lead to...