Abstract
Despite abundant rainfall and groundwater resources, the State of Hawaii has managed to erect so many barriers to efficient use that serious conflicts have erupted over use rights to water. In what is currently the most prominent battle, environmental and agricultural interests of windward Oahu are pitted against agricultural producers on the leeward side over the allocation of aqueduct water in the Koolau Mountains. To inform this debate, a model of conjunctive use is constructed and optimal allocation of ground, surface, and aqueduct water computed. Optimal use of the aqueduct water is as a substitute for groundwater. This postpones the eventual, expensive use of desalination, thus benefiting future users. By making use rights fully transferable and charging current users water’ s true opportunity cost, both windward and leeward users would be winners.
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