Groundwater Institutions in the Face of Global Climate Change

Abstract

We review the literature on the performance of groundwater institutions, including command-and-control (CAC) approaches, market-based institutions (MBIs), and voluntary approaches, and evaluate how they will perform as agriculture adapts to climate change. Both CAC approaches and MBIs lead to uneven distributional impacts on farmers, and voluntary approaches have not been successful in reducing water withdrawal on a large scale. A polycentric approach of regulation plus local management might perform well. Climate change will increase the irrigation demand for groundwater and demand flexible and properly scoped institutions that attend to local conditions.