Bargaining and Devolution in the Upper Guadiana Basin

Abstract

Increasingly, central governments approach contentious natural resource allocation problems by devolving partial decision-making responsibility to local stakeholders. This paper conceptualizes devolution as a three-stage process and uses a simulation model calibrated to real-world conditions to analyze devolution in Spain's Upper Guadiana Basin. The Spanish national government has proposed spending over a billion euros to reverse a 30 year decline in groundwater levels. We investigate how the government can most effectively allocate this money to improve water levels by utilizing its power to set the structure of a local negotiation process. Using a numerical Nash model of local bargaining, we find that if the national government creates appropriate incentives, local bargaining can produce water stabilization. The actual water levels that will emerge are highly dependent on the central government's decisions about the budget available to local stakeholders and the default policy, which will be influenced by the relative value the government places on various financial and environmental outcomes. Our paper concludes by determining the relationship between these relative valuations and the government's preferences over water levels.

On the Implementation and Performance of Water Rights Buyback Schemes

“…This approach would imply devolving partial decision-making responsability to local stakeholders. In a recent study, Marchiori et al (2012) showed that an additional bene…t of this approach is that it might be able to better take account of equity issues associated with the distribution and reallocaton of water rights. Equity considerations are particularly important in light of the fact that in many real-world settings water resource expansion has essentially followed the 'rule of capture'; that is, the current allocation of water rights is the result of the order of arrival of sectors or users rather than long term planning on the part of governmental authorities (Ansink and Marchiori, 2009).…”

Network Economics and the Environment: Insights and Perspectives

“…The underlying rationale is that involving actors at different levels can lead to improved accountability of stakeholders, higher legitimacy of the decisions, and management strategies that are better adapted to local conditions (e.g. Marchiori et al, 2012).…”

Urban Network Economics and the Environment: Insights and Perspectives

“…The underlying rationale is that involving actors at different scales can lead to improved accountability of stakeholders, higher legitimacy of the decisions, and management strategies that are better adapted to local conditions (e.g. Marchiori et al, 2012).…”