There is no systematic empirical evidence on the impact of federal versus regional control over provision of groundwater. The objective of this paper is to fill this gap by providing this evidence. This paper proposes and tests the hypothesis that under high cost of provision to the legislators, regional regimes can lead to conservation because they internalize inter-temporal externalities that would arise from the depletion of the resource. Using nationally representative data on groundwater from constituencies in India, and an increase in the cost of groundwater provision for the legislators induced by the reforms in the electricity sector, the paper shows that private competition induced in electricity sector leads to groundwater conservation under regional regimes.
Sheetal Sekhri. Federalism versus Regional Control: Implications for Groundwater Resource in India. (2011) 2 pp.