The Illusion of Suboptimal Dam Management: The Role of Ecology in Managed Systems

with David Finnoff and Sean Bertalot

Work in Progress

With rising demand for limited water in the Western United States, managing freshwater systems is becoming increasingly difficult. In this paper, we model a dam manager’s seasonal release decision, in which they balance competing interests among various stakeholders while accounting for seasonal variations in inflows, evapotranspiration, and ecological processes. We contextualize this model using data from Jackson Lake, where a century-old interstate compact constrains managers’ flexibility to adapt to changing physical conditions. Using a non-autonomous framework to capture seasonal dynamics in water systems, we develop a model that accounts for ecological processes and enables managers to justify water-allocation decisions. Our analysis indicates that institutional constraints alone cannot explain managerial departures from purely economic-optimal policies; rather, incorporating the unpriced ecological services of the lake reconciles observed management practices. Models that omit ecological processes mischaracterize observed management as suboptimal, with consequences for how managers are evaluated and how policy is designed.