We test the game-theoretic foundations of common-pool resources using an individual-level dataset of groundwater usage that accounts for 3% of US irrigated agriculture. Using necessary and suﬀicient revealed preference tests for dynamic games, we ﬁnd: (i) a rejection of the standard game-theoretic arguments based on strategic substitutes, and instead (ii) support for models building on reciprocity-like behavior and strategic complements. By estimating strategic interactions directly, we ﬁnd that reciprocity-like interactions drive behavior more than market and climate trends. Taken together, we take a step toward developing more realistic models to understand groundwater usage, and related issues pertaining to tragedy of the commons and commons governance.
Koch, Caleb M. and Nax, Heinrich H., "'Follow the Data' — What Data Says About Real-world Behavior in Commons Problems" (2019). Cowles Foundation Discussion Papers. 53.