The inter-temporal resource allocation efficiency of a rights-based common-pool resource management system is threatened by a stock externality when one user’s extraction lowers the resource stock and raises the extraction cost for others. This paper proposes a novel decentralized rights-based...

This paper examines how a surface water market affects the performance of a groundwater basin that is in open access. The market only solves the groundwater over-extraction problem when pumping costs are high, while market failure arises when the common pool resource (CPR) problem is severe. I...