The Importance of Well Yield in Groundwater Demand Specifications
研究发现，忽略井出水量会高估地下水需求的价格弹性，导致基于价格的保护政策对用水和福利影响的预测不准确。
Implementing effective resource management policies critically depends on accurate estimates of the price elasticity of resource demand. In the case of groundwater, previous research estimating well-level groundwater demand has largely neglected the importance of well yield, which is a physical limit on the rate of groundwater extraction. In this study, we empirically estimate the price elasticity of demand for groundwater using well-level data from Colorado. Our results demonstrate that when well yield is omitted, price elasticity is overestimated. This in turn creates inaccurate predictions of the effect of price-based conservation policies on ground-water use and welfare.