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The study of land subsidence has recently been expanded due to its increased occurrence and magnitude worldwide. This paper develops and applies an optimal control model of groundwater extractions under conditions of land subsidence. We include, in a traditional groundwater management model, two types of negative externalities associated with land subsidence: damage to infrastructure and to economic activities, and the loss of aquifer storage capacity. Using a two-stage optimal control method, characterized by two sub-problems corresponding to the phase before and after the occurrence of subsidence, we find the economically sustainable paths of groundwater extractions and water table levels under the existence of land subsidence impacts. The theoretical results indicate that the presence of land subsidence dictates the optimal paths of groundwater withdrawals and water table levels. The model has been applied to the Alto Guadalentín over-exploited aquifer system in the Segura River Basin of Spain. The empirical outcomes indicate that by following the optimal paths, groundwater extractions should be curtailing to avoid reaching the critical water level at which subsidence takes place. Results suggest that regional net present value of welfare over the planning period, under the two land subsidence scenarios, is reduced by nearly 1–5%, compared to the no land subsidence scenario. Furthermore, under subsidence, even with relatively small impacts of both types of externalities, groundwater optimal extractions are kept at levels that avoid these externalities. These outcomes clearly call for government intervention in order to reduce groundwater withdrawals in aquifers with propensity to face undesirable subsidence effects. • LS due to aquifers overused causes major social costs with irreversible impacts. • LS has not received proper attention by regulators and the economic damages are not accurately assessed. • This paper develops a groundwater optimization model including negative externalities of LS. • In presence of subsidence, even with small impacts, groundwater management is necessary. • The results call for government intervention to curtail groundwater withdrawals to face LS. [ABSTRACT FROM AUTHOR]

Groundwater is key to economic growth in the Mediterranean region. This is particularly true of areas such as southern Spain, where aquifers underpin social development by supplying water to a booming tourist industry. Intensive groundwater use raises sustainability concerns, as pumping often exceeds the long-term recharge rate. Climate change and population growth are likely to exacerbate the water supply challenge in the coming years, due to the expected decrease in rainfall and to increasing competition among users. This paper examines some of the main aquifers in the Costa del Sol region, one of Spain's leading tourist destinations, where intensive groundwater extraction has led to water table drawdowns and the desiccation of all major springs. A numerical model was developed and calibrated for the purpose of evaluating the likely evolution of the system in the future. Downscaled scenarios from global circulation models were coupled with population growth forecasts to establish a range of plausible water management scenarios. Given the relatively small size of the aquifers and the limited recharge rate, the current pumping patterns appear unsustainable. Results suggest that drawdowns in excess of 150 m could take place within the next decade, thus compromising domestic supplies. Image 103287324 • A distributed model was applied to simulate water level evolution in Mijas range. • Three management scenarios were developed and tested for the 2015–2035 interval. • Climate change and current water management will produce an unsustainable situation. • New sources of water supply are needed to guarantee drinking water in Mijas area. [ABSTRACT FROM AUTHOR]