Research Recap: Can groundwater conservation policies have unintended consequences?

“Jevons’ Paradox and Efficient Irrigation Technology”

While water is arguably the most essential resource on earth, it’s scarcer than ever before. Whether it’s the food we eat, the farmers who produce our food, or the local economies supporting agricultural production, all are affected by the amount of groundwater available. Climate change, urban demand, and trends in agricultural production are projected to increase pressure on renewable water resources, making the preservation of groundwater resources an even more pressing issue.

Research by C.-Y. Cynthia Lin Lawell, associate professor at the Dyson School, Cornell PhD student Louis Sears, and undergraduate students Joseph Caparelli ’19, Clouse Lee ’19, Devon Pan ’19, Gillian Strandberg ’18, and Linh Vuu ’18 discusses efficient irrigation technology, Jevons’ Paradox, and the possible perverse consequences of incentive-based programs for agricultural groundwater conservation.

Although there are policies in place that encourage the adoption of more efficient irrigation technology, the authors find that such policies may have unintended and possibly perverse consequences if policymakers fail to account for users’ behavior responses to their policies.

In fact, this situation may prompt the appearance of a Jevons’ Paradox, which the authors define as a situation “whereby a technology that enhances the efficiency of using a natural resource does not necessarily lead to less consumption of that resource.” In this case, the authors observe that “incentive-based conservation programs may have the perverse consequence of actually increasing rather than decreasing groundwater extraction.”

The authors suggest a number of ways to mitigate any potential unintended or perverse consequences, all of which involve policymakers in some capacity.

• One alternative worth considering, according to the authors, is “incorporating insights from behavioral economics, such as behavioral ‘nudges’, or non-financial changes in the manner in which options are presented to decision-makers that may increase the likelihood of a certain behavior.”
• Another complementary aspect to consider when designing policy for sustainable agricultural groundwater management is reporting the groundwater extraction data that is collected in order to “enable groundwater users to make peer comparisons, which has been shown to promote conservation in domestic water use.”

This paper reinforces the belief that, when crafting policies for sustainably managing agricultural groundwater use, it is critical that policymakers account for all possible behavioral responses to their policy, including any potential unintended perverse consequences that may arise.

Disciplines represented:

Agricultural science, behavioral economics, sustainability, resource economics

Schools/contributing organizations:

• Charles H. Dyson School of Applied Economics and Management, Cornell University
• Computing and Information Science, Cornell University
• Department of Economics, Cornell University
• College of Agriculture and Life Sciences, Cornell University

Co-authors from Cornell University:

• Louis Sears, PhD student, Applied Economics and Management
• Joseph Caparelli ’19, Computer Science and Economics
• Clouse Lee ’19, Applied Economics and Management
• Devon Pan ’19, Environmental and Sustainability Sciences
• Gillian Strandberg ’18, Applied Economics and Management
• Linh Vuu ’18, Applied Economics and Management
• C.-Y. Cynthia Lin Lawell, Robert Dyson Sesquicentennial Chair in Environmental, Energy, and Resource Economics and associate professor

Publication information:

“Jevons’ Paradox and Efficient Irrigation Technology” was published in the peer-reviewed journal Sustainability, Volume 10, Issue 5, as part of a special issue, Sustainable Agriculture: The State of the Great Debates.

Read the “Jevons’ Paradox and Efficient Irrigation Technology” paper