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Market power in California's water market

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Listed:
  • Françeska Tomori
  • Erik Ansink
  • Harold Houba
  • Nick Hagerty
  • Charles Bos

Abstract

We estimate market power in California's surface water market. Market power may distort the potential welfare gains from water marketing. We use a Nash‐Cournot model and derive a closed‐form solution for the extent of market power in a water market setting. We then use this solution to estimate market power in a newly assembled dataset on California's water economy. We show that, under the assumptions of the Nash‐Cournot model, market power in this thin market is limited.

Suggested Citation

  • Françeska Tomori & Erik Ansink & Harold Houba & Nick Hagerty & Charles Bos, 2024. "Market power in California's water market," American Journal of Agricultural Economics, John Wiley & Sons, vol. 106(3), pages 1274-1299, May.
    • Handle: RePEc:wly:ajagec:v:106:y:2024:i:3:p:1274-1299
    DOI: 10.1111/ajae.12434
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    Cited by:

    1. Harold Houba & Françeska Tomori, 2023. "Stackelberg Social Equilibrium in Water Markets," Games, MDPI, vol. 14(4), pages 1-9, July.

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    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water

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