Underground water management in the West Mancha aquifer

Abstract

This research focuses on the particular problem that emerges in overexploited aquifers when environmental externalities are present. This is the case of Mancha Occidental where environmental externalities derive from the interrelation of groundwater reserves and the preservation of Tablas de Daimiel wetlands. Several mathematical programming models are developed to evaluate alternative groundwater management policies aimed to assure the preservation of the wetlands. The results permit to argue that the Gisser-Sánchez rule, which states that gains derived from optimal management in groundwater are not significant, may be questionable. Moreover, the results show that differences in groundwater management policies are strongly determinant. In the first place, it has to be emphasized that a fix quota system could result in significant inefficiencies, both from the agricultural sector perspective and from the environmental perspective. Secondly, a payment system implemented to compensate the application of water quotas might cause undesired long term effects, as its relative compensation value will diminish as the aquifer’s recovery level increases. Finally, the results show that a water banking system may contribute to reconcile farmers´ interest and the preservation of the wetlands.