Transboundary aquifers are ubiquitous and strategically important to global food and water security. Yet these shared resources are being depleted at an alarming rate. Focusing on the Disi aquifer, a key nonrenewable source of groundwater shared by Jordan and Saudi Arabia, this study develops a two‐stage game that evaluates optimal transboundary strategies of common‐pool resource exploitation under various assumptions. The analysis relies on estimates of agricultural water use from satellite imagery, which were obtained using three independent remote sensing approaches. Drawdown response to pumping is simulated using a 2‐D regional aquifer model. Jordan and Saudi Arabia developed a buffer‐zone strategy with a prescribed minimum distance between each country's pumping centers. We show that by limiting the marginal impact of pumping decisions on the other country's pumping costs, this strategy will likely avoid an impeding tragedy of the commons for at least 60 years. Our analysis underscores the role played by distance between wells and disparities in groundwater exploitation costs on common‐pool overdraft. In effect, if pumping centers are distant enough, a shared aquifer no longer behaves as a common‐pool resource and a tragedy of the commons can be avoided. The 2015 Disi aquifer pumping agreement between Jordan and Saudi Arabia, which in practice relies on a joint technical commission to enforce exclusion zones, is the first agreement of this type between sovereign countries and has a promising potential to avoid conflicts or resolve potential transboundary groundwater disputes over comparable aquifer systems elsewhere.

A growing empirical literature associates climate anomalies with increased risk of violent conflict. This association has been portrayed as a bellwether of future societal instability as the frequency and intensity of extreme weather events are predicted to increase. This paper investigates the theoretical foundation of this claim. A seminal microeconomic model of opportunity costs—a mechanism often thought to drive climate–conflict relationships—is extended by considering realistic changes in the distribution of climate-dependent agricultural income. Results advise caution in using empirical associations between short-run climate anomalies and conflicts to predict the effect of sustained shifts in climate regimes: Although war occurs in bad years, conflict may decrease if agents expect more frequent bad years. Theory suggests a nonmonotonic relation between climate variability and conflict that emerges as agents adapt and adjust their behavior to the new income distribution. We identify 3 measurable statistics of the income distribution that are each unambiguously associated with conflict likelihood. Jointly, these statistics offer a unique signature to distinguish opportunity costs from competing mechanisms that may relate climate anomalies to conflict.

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