Recent decades have seen an explosion in the drilling of wells and extraction of groundwater in India and China. According to many experts, the rise of groundwater extraction has led to increased food production and food security in these two populous nations. However, this trend has occurred at the same time as water tables have declined in many regions in India and China. The talk will highlight the spatial organization of water markets and show that increasing scarcity of water may lead to a boom in “well-drilling,” contrary to what one may expect. Resource scarcity reduces competition among water sellers, hence increases profits. Higher profits induce greater entry.
Ujjayant Chakravorty is Professor of Economics and Environmental Studies at Tufts University and Fellow at the Toulouse School of Economics and CESifo.
Lunch & Learns occur every Thursday during the fall and spring semesters. Everyone is welcome. Food will be provided on a first-come basis. Lunch & Learn attendance is required for students enrolled in ENV0095 Special Topics in Environmental Studies with Colin Orians.