From the Giannini Foundation of Agricultural Economics, University of California:
Groundwater markets offer a cost-effective means of meeting management goals under the 2014 Sustainable Groundwater Management Act. Using data from the Coachella Valley groundwater basin, we quantify the economic impacts of trade in one of California’s most important agricultural regions. Facilitating groundwater trade under a mandatory basin-wide “cap” on pumping will reduce disruptions to the local economy and keep land in production, relative to a scenario where trade is prohibited.