As reliance on groundwater increases, the impact of groundwater-intensive use in internationally shared aquifers threatens not only to create negative environmental and economic externalities, but also to generate tensions between neighboring nations. Through an investigation of the shared Santa Cruz aquifer, located along the United States—Mexico border, we aim to understand factors leading to effective management of transboundary groundwaters. Specifically, we find that purely state-centric approaches provide limited explanatory value, and instead examine how national (domestic) arrangements for water management condition a country's position vis-à-vis its shared groundwaters. Polycentricism in national and subnational institutional regimes leads to gaps and overlaps in authority, limiting binational groundwater management. Concurrently, evolving institutional arrangements lead to ambiguity in decision making, yet crucially also provide opportunities for innovation in binational agenda setting and data sharing, which in turn aid in the alignment of both countries' priorities for the transboundary Santa Cruz aquifer.
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