Transboundary Extraction of Groundwater in the Presence of Hydraulic Fracturing

We studied transboundary ground water management problems in the presence of hydraulic fracturing (fracking). We found that the presence of risk suggests a need to exercise caution in fracking. We also found that a cooperative outcome implies the decrease in fracking and the increase in steady state survival rate of groundwater. However, water extraction rates remained the same in both cooperative and noncooperative solutions. We also argue that a Pigouvian type tax could be imposed on the natural gas developers.