Commitment vs. noncommitment behaviors in natural resource conflicts: A case study of groundwater resources

We examine the problem of natural resource exploitation when an exceptional extraction of a resource (groundwater) is needed that is devoted to a different use than its regular use. The study applies a two-stage Stackelberg game to examine the strategic behavior of players who compete for water, with the leader (public resource manager), with varying degrees of environmental and public health concerns; the manager of the new (nonregular) resource use, who only intervenes in the second stage of the game; and the follower, who is a regular (agricultural) resource user. We examine the crucial resource of groundwater, introducing two types of Stackelberg equilibria (open-loop and feedback) that can arise depending on agents' commitment behavior, comparing the extraction behaviors of the leader and agricultural user for the two equilibria and the effects on the final state of the resource and agents' profits. Unexpectedly, we demonstrate that situations can occur in which noncommitment strategies could be more favorable than commitment strategies in terms of the final aquifer stock and the regular user's profits.