The economic effects of conjunctive management of ground and surface water supplies for irrigation are formulated as an optimal control model. An empirical hydroeconomic model is estimated for the Yolo County district in California. Two alternative solution methodologies (analytic Riccatti and mathematical programing) are applied and compared. Results show the economic potential for interbasin transfers and the impact of increased electricity prices on optimal groundwater management.The conjunctive use of groundwater and surface water is being strongly advocated in the western states due to increasing water demands by agricultural, urban, and industrial users. Given the public nature of groundwater supplies, empirical decision rules for regional managers of interdependent basins are a necessary prerequisite to conjunctive use. Empirical analysis of optimal conjunctive management has been performed using a dynamic programing approach by' Burns [ 1963], Butt [ 1974], Cummings and Winkleman [ 1970], and Biere and Lee [972]. Unfortunately, use of dynamic programing restricts the specification of the ground and surface water systems to low-dimension representations of the system. Invariably this aggregation is unsatisfactory for multibasin regional analyses. In addition to overcoming the dimensionality problem inherent in dynamic programing [Murray and Yakowitz, 1979], the optimal control apprceach presented in this paper yields additional insights on economic management by using the resulting optimal user costs of groundwater stocks.The approach demonstrated in this article combines the linearized output of hydrologic and economic models in a discrete time, linear, quadratic control problem. Given/this approximate specification, analytical solutions are available for the resulting control problem. The analytical control solutions are compared with numerical solutions which allow a less restrictive model specification. The advantages and disadvantages of these alternative approaches are compared. The methodological problem is motivated by an empirical analysis of a Northern California region comprised of six hydrologic subbasins, two reservoirs, and a river system.In the first section the theoretical basis for optimal water allocation is derived using an optimal control approach, and economic interpretations are derived from the resulting necessary conditions. In the following section the empirical regional multibasin model is described, and the hydrologic and economic submodels that generate the control model parameters are briefly reviewed. The empirical results address a number of policy questions: What is the value of Copyright 1982 by the American Geophysical Union. Paper number 2W0830. 0043-1397/82/002 W-083055.00 groundwater stocks, and how would this stimulate interbasin transfer? How would ground and surface water be optimally allocated over a 30-year horizon, and what is the impact of increased energy costs on the optimal allocation? A THEORETICAL BASIS FOR MULTIBASIN ALLOCATION Water allocation can be consi...
An optimal control model is used to determine the socially optimal spatial and temporal allocation of groundwater and surface water among agricultural and urban uses. The control model is described briefly and its advantages over other dynamic models are enumerated. Optimal rates of groundwater pumpage over the planning horizon were highly sensitive to increasing energy costs. Groundwater basins are shown to react differently to alternative economic and hydrological parameters. In a dynamic setting, a policy of pump taxes was shown empirically to be superior to pro-rata quotas and uncontrolled pumpage.Key words: control model, groundwater, energy cost, pro-rata allocation, Pigovian taxation.The severe drought in the western United States in 1976-78 brought the problems of allocating extremely limited water resources to the attention of agriculturalists and urbanites alike. Greatly reduced surface water supplies exacerbated the already critical pressure on remaining groundwater stocks in the same areas.The chronic overdraft of many western states groundwater basins can be attributed directly to their common pool nature. The lack of explicit property rights to groundwater stocks results in individual users of the resource evaluating only their own private pumping costs in their decision framework and implicitly assigning a zero opportunity cost to the stock portion of the resource. Thus, the private decision does not take into account any user cost and results in a divergence in the private and the social optimal rate of pumping. 1 The objective of this paper is to describe briefly an optimal control model which can be used to determine the socially optimal spatial and temporal allocation of groundwater and surface water among agricultural and urban uses. The control model is then applied to a representative region of California under several sets of energy costs. Two policies, prorata allocation and taxation, are evaluated empirically as alternatives for accounting for externalities due to the common pool problem. The Conceptual FrameworkSeveral authors have investigated the conjunctive use of groundwater and surface water using various techniques. Buras developed a dynamic programming algorithm to solve the problem of conjunctive use of reservoirs and aquifers. His operating policy, however, considered the physical system as a single unit and thus ignored differences in hydrology that occur in a complex groundwater system. Burt (1964, 1966, 1967a, b) utilized a mathematical programming approach to develop a demand function for irrigation water used in a dynamic programming formulation of the aquifer management problem. Bredehoeft and Young used a simulation model to estimate the solution of problems involving the development of a stream-aquifer system in an economic model of irrigation. Bear and Levin studied optimal utilization of an aquifer as one element of a Jay E. Noel is a resource economist with Auslam and Associates,
A model was developed to predict the value contribution of forest condition on small urban-wildland interface properties. Sample data were collected on property transactions in the Lake Tahoe Basin of California between 1990 and 1994. A variant of the stand density index (SDI) and a tree health measure were added to a list of traditional property characteristics (i.e., location, house size, lot size) to express the influence of tree care on property value. These aesthetic characteristics were statistically significant despite the expected dominant influence of the traditional characteristics. Values for the forest density and health characteristics were estimated and reveal a contribution to property value between 5% and 20%.
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