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Alla Fridman 

Paper presents an optimal control model with the stocks of two resource: one is the stock of exhaustible resource (groundwater) and the other is the stock of waste water which is a by-product of water use. Waste water could be re-used but this resource has a higher marginal cost than the groundwater. The characteristics of efficient water consumption vector and dynamics of groundwater and waste water stocks are analyzed under the assumption of limited storage capacity of waste water stocks. The sensitivity of efficient vectors of exogenous parameters (groundwater stock and its refi ll, marginal cost of renewable substitute) is investigated.

exhaustible resources, water resources, recycling, optimal control
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