Integrating Groundwater Conservation and Risk Mitigation under Uncertainty: Strategies for Sustainable Aquifers and Agriculture

Abstract

Groundwater is a crucial resource for agricultural production globally, especially in water-scarce regions. However, increased irrigation demands, weak governance, and climate change-induced variability threaten the sustainability of aquifers, jeopardizing long-term agricultural productivity. This dissertation investigates how integrating groundwater conservation policies with financial risk management strategies can simultaneously achieve aquifer sustainability and maintain economic stability for farmers. The research specifically focuses on the Sheridan-6 Local Enhanced Management Area (LEMA) in Kansas, U.S.A, an innovative groundwater conservation initiative that implements multi-year pumping restrictions. Employing a multi-method approach—including stochastic optimization, mixed-integer programming, and agent-based modeling—this study comprehensively evaluates how farmers respond to regulatory constraints, uncertain weather patterns, and economic conditions. Findings highlight that multi-year groundwater allocation systems, such as LEMA, provide farmers with valuable operational flexibility to strategically manage limited water resources amidst varying precipitation and fluctuating market prices. Crop insurance (revenue protection with 75% coverage level) emerges as a critical financial instrument for stabilizing farm incomes and mitigating risk; however, it can unintentionally incentivize higher groundwater use, thus potentially undermining conservation objectives. Agent-based simulations further demonstrate nuanced farmer behavioral responses, revealing complex adjustments in cropping decisions, irrigation practices, and compliance behaviors under different regulatory and economic scenarios. Results underscore the inherent trade-offs farmers face between short-term farm profitability and long-term aquifer sustainability. Ultimately, the dissertation emphasizes the necessity of aligning groundwater policies with economic incentives to balance resource conservation with agricultural resilience. The insights and methodologies developed here offer valuable guidance for scalable and adaptive groundwater management strategies, providing robust policy recommendations for other regions facing similar groundwater sustainability challenges.