Managing Water Demand as a Regulated Open MAS

The management of natural resources is a challenge of significant social relevance. At the core of water policy is the need to foster a more rational use of the resource and this may be addressed by creating an efficient market of water rights [4]. However the design and operation of such a market is not an easy endeavor because it needs to coexist in a complex social and legal framework. Most water management models are based on equational descriptions of aggregate supply and demand in a water basin [2] but few include an agent-based perspective. We explore an alternative approach in which individual and collective agents are an essential component because their behavior (and effects) may be influenced by policy-making. Our focus is on water-right demand and, in particular, on the type of legal and market mechanisms that may have an incidence on that, so that water use is efficient. In particular we acknowledge the following facts: (1) that many stakeholders are involved in the market; (2) that stakeholders have different and frequently conflicting objectives; (3) that stakeholders have decision-making capabilities; (4) that there is the possibility of establishing conventions that are applicable to the actions of stakeholders, and that stakeholders are capable of complying with those conventions; (5) that these stakeholders are autonomous to comply or not, with the conventions. With respect to demand we build on two assumptions. First, we assume that water use is granted to individual agents or to groups of individuals through water rights that specify the amount of water, period and type of use granted, as well as the location where that water may be extracted. Second, we assume that these rights may be traded.1