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A theoretical model...
A theoretical model of water and trade
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Dang, Qian (author)
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Konar, Megan (author)
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Reimer, Jeffrey (author)
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- Di Baldassarre, Giuliano (author)
- Uppsala universitet,Luft-, vatten- och landskapslära
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Lin, Xiaomen (author)
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Zeng, Ruije (author)
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(creator_code:org_t)
- Elsevier BV, 2016
- 2016
- English.
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In: Advances in Water Resources. - : Elsevier BV. - 0309-1708 .- 1872-9657. ; 89, s. 32-41
- Related links:
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https://doi.org/10.1...
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https://urn.kb.se/re...
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Abstract
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- Water is an essential input for agricultural production. Agriculture, in turn, is globalized through the trade of agricultural commodities. In this paper, we develop a theoretical model that emphasizes four tradeoffs involving water-use decision-making that are important yet not always considered in a consistent framework. One tradeoff focuses on competition for water among different economic sectors. A second tradeoff examines the possibility that certain types of agricultural investments can offset water use. A third tradeoff explores the possibility that the rest of the world can be a source of supply or demand for a country's water-using commodities. The fourth tradeoff concerns how variability in water supplies influences farmer decision-making. We show conditions under which trade liberalization affect water use. Two policy scenarios to reduce water use are evaluated. First, we derive a target tax that reduces water use without offsetting the gains from trade liberalization, although important tradeoffs exist between economic performance and resource use. Second, we show how subsidization of water-saving technologies can allow producers to use less water without reducing agricultural production, making such subsidization an indirect means of influencing water use decision-making. Finally, we outline conditions under which riskiness of water availability affects water use. These theoretical model results generate hypotheses that can be tested empirically in future work.
Subject headings
- NATURVETENSKAP -- Geovetenskap och miljövetenskap -- Oceanografi, hydrologi och vattenresurser (hsv//swe)
- NATURAL SCIENCES -- Earth and Related Environmental Sciences -- Oceanography, Hydrology and Water Resources (hsv//eng)
Keyword
- Water resources; Trade; Theoretical model; Profit maximization; Decision-making under risk; Tradeoffs
Publication and Content Type
- ref (subject category)
- art (subject category)
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