Provision of natural and human resources in developing economies

This dissertation consists of three essays that examine the relative merits of private and public provision of natural and human resources in India.;The second paper examines how localized markets for groundwater in northern India affect the depletion rate of the resource. The development of markets for groundwater can reduce resource use by internalizing its opportunity cost. However, expansion of markets also makes it possible to sell groundwater, which may lead to more rapid extraction. A model is developed and tested using village level data to understand this trade-off. The central finding is that water transactions are decreasing in the level of fixed costs of private provision and that increased market breadth results in lower levels of aquifer depletion.;The third paper examines whether public provision of tertiary education in India is better than private provision in the context of general education sector. College educational outcomes of graduates of public colleges in India are better than their private counterparts. Also, public colleges are highly subsidized. So the better performance can be a result of value added or that of positive sorting of students into subsidized public colleges. Making use of the features of the admission process and a newly established data set, this paper finds that the public colleges have no added value at the margin of selection and the observed differences are because of positive sorting.;The first paper evaluates the effects of a public program of groundwater provision for irrigation purposes on groundwater depletion in Northern India. Using village level panel data on aquifers, I find evidence that this program decreased total use of groundwater rather than expanding it. I develop a model to explain these findings. The model establishes that public provision has a heterogeneous impact on the aquifers and it leads to sustainable use when the fixed costs for private well provision are high. Consistent with the predictions, find that there is a jump in the water-saving effects of the scheme at the water-table depth at which the fixed costs of water provision jump substantially due to the physical limitations of low-cost irrigation pumps.