Julia de Frutos Cachorro, Jesús Marín-Solano, Jorge Navas
{"title":"Competition between different groundwater uses under water scarcity","authors":"Julia de Frutos Cachorro, Jesús Marín-Solano, Jorge Navas","doi":"10.1016/j.wre.2020.100173","DOIUrl":"10.1016/j.wre.2020.100173","url":null,"abstract":"<div><p>We study groundwater management under a regime shock affecting water availability, using a dynamic common-property resource game. The different players correspond to different groundwater uses (irrigation or urban water supply), enabling us to consider competition between economic sectors for the stock with limited availability. The players have different water demand functions and, under certain circumstances depending on the shock, different discount rates. The effects of asymmetries in both demand and discount rates are analyzed, comparing cooperative and non-cooperative solutions. A numerical analysis for the particular case of the Western La Mancha aquifer in Spain is conducted to analyze the degree of inefficiency of non-cooperative solutions with respect to cooperative solutions in terms of welfare. We show that a higher asymmetry in discount rates reduces the inefficiency of non-cooperative solutions. The opposite result is obtained when considering the asymmetry in demand.</p></div>","PeriodicalId":48644,"journal":{"name":"Water Resources and Economics","volume":"33 ","pages":"Article 100173"},"PeriodicalIF":2.2,"publicationDate":"2021-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1016/j.wre.2020.100173","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44177362","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Fangping Rao , Abudureheman Abudikeranmu , Xiaoping Shi , Nico Heerink , Xianlei Ma
{"title":"Impact of participatory irrigation management on mulched drip irrigation technology adoption in rural Xinjiang, China","authors":"Fangping Rao , Abudureheman Abudikeranmu , Xiaoping Shi , Nico Heerink , Xianlei Ma","doi":"10.1016/j.wre.2020.100170","DOIUrl":"https://doi.org/10.1016/j.wre.2020.100170","url":null,"abstract":"<div><p><span>Reforms in irrigation management can make important contributions to reducing irrigation </span>water scarcity<span><span>. This paper attempts to examine the role of participatory irrigation management (PIM) in farmers’ mulched drip irrigation<span> technology adoption decisions. It is based on a comparative analysis between government-promoted mulched drip irrigation technology (GMDIT) and localized self-governed mulched drip irrigation technology (LMDIT) in rural Xinjiang, China. Data from a survey conducted in 2017 across 739 households covering 1763 plots in Awati County in Xinjiang were used to estimate a nested logit model. The results indicate that PIM induces farmers to switch from traditional </span></span>flood irrigation<span> technology to GMDIT but does not promote the adoption of LMDIT. We conclude that promoting PIM can make an important contribution to more sustainable water use in this drought-prone area but that the self-governance of localized irrigation systems requires more attention by local governments.</span></span></p></div>","PeriodicalId":48644,"journal":{"name":"Water Resources and Economics","volume":"33 ","pages":"Article 100170"},"PeriodicalIF":2.2,"publicationDate":"2021-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1016/j.wre.2020.100170","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136896900","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Muhammad Halley Yudhistira, Prani Sastiono, Melly Meliyawati
{"title":"Exploiting unanticipated change in block rate pricing for water demand elasticities estimation: Evidence from Indonesian suburban area","authors":"Muhammad Halley Yudhistira, Prani Sastiono, Melly Meliyawati","doi":"10.1016/j.wre.2020.100161","DOIUrl":"10.1016/j.wre.2020.100161","url":null,"abstract":"<div><p>We exploit sudden changes in the marginal tariff scheme to estimate the price elasticity of water demand using households' and firms' data in Tangerang Regency, a part of the Jakarta Greater Metropolitan Area, where water demand management is imperative due to the city's growing population and industrial activities. A monthly water consumption dataset at the consumer level is used in our study. Using the regression discontinuity in time (RDiT) approach, we find the price elasticity of water demand is −0.32 for household consumers and inelastic to changes in price. In contrast, elasticity for industrial and commercial consumers is −1.16, implying a more elastic response. The results raise concerns that firms substitute for a cheaper water source, endangering the water resources sustainability in the area.</p></div>","PeriodicalId":48644,"journal":{"name":"Water Resources and Economics","volume":"32 ","pages":"Article 100161"},"PeriodicalIF":2.2,"publicationDate":"2020-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1016/j.wre.2020.100161","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42959560","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Bebonchu Atems, Michael Maresca, Baomei Ma, Emily McGraw
{"title":"The impact of El Nio-Southern Oscillation on U.S. food and agricultural stock returns","authors":"Bebonchu Atems, Michael Maresca, Baomei Ma, Emily McGraw","doi":"10.1016/j.wre.2020.100157","DOIUrl":"10.1016/j.wre.2020.100157","url":null,"abstract":"<div><p><span>The paper examines the response of twelve U.S. agricultural </span>stock returns<span> to El Niño-Southern Oscillation (ENSO) shocks using a recursive VAR model. Baseline results indicate that for seven of the stock returns, an ENSO shock has positive and significant effects. The effects, however, are shortlived, generally becoming statistically indistinguishable from zero three to six months after the shock. Variance decomposition analyses show that ENSO shocks have little explanatory power for fluctuations in U.S. agricultural stock returns. We also provide evidence that historically, movements in the stock returns of U.S. food and agricultural companies have been driven by other shocks, rather than ENSO shocks.</span></p></div>","PeriodicalId":48644,"journal":{"name":"Water Resources and Economics","volume":"32 ","pages":"Article 100157"},"PeriodicalIF":2.2,"publicationDate":"2020-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1016/j.wre.2020.100157","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49241233","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Riccardo Marzano , Charles Rougé , Paola Garrone , Julien J. Harou , Manuel Pulido-Velazquez
{"title":"Response of residential water demand to dynamic pricing: Evidence from an online experiment","authors":"Riccardo Marzano , Charles Rougé , Paola Garrone , Julien J. Harou , Manuel Pulido-Velazquez","doi":"10.1016/j.wre.2020.100169","DOIUrl":"10.1016/j.wre.2020.100169","url":null,"abstract":"<div><p><span><span>Urban water demand management is key to water supply sustainability in high-density, water-stressed areas throughout the world, and emerging technologies could transform it. In particular, smart metering could allow for conserving water by dynamically changing prices to reflect </span>water scarcity and supply cost variability. Yet, little is known on end-users’ reaction to short-term price changes, an essential determinant of the effectiveness and </span>acceptability of dynamic water pricing. This paper reports on the design and results of an online experiment that measures end-users’ water consumption decisions when confronted with time-varying prices, and investigates the interaction between pricing and water scarcity awareness. We design a series of treatments where players must indicate their shower length given different water prices, price variations, and scarcity scenarios. Beyond corroborating the theory that higher prices lower usage, the experiment finds evidence of a dynamic pricing effect: users respond more strongly to a given price if they have been exposed to a lower price before. This suggests short-term residential price increases could be effective at boosting water conservation.</p></div>","PeriodicalId":48644,"journal":{"name":"Water Resources and Economics","volume":"32 ","pages":"Article 100169"},"PeriodicalIF":2.2,"publicationDate":"2020-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1016/j.wre.2020.100169","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"41537681","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Lars T. de Ruig , Toon Haer , Hans de Moel , W.J.Wouter Botzen , Jeroen C.J.H. Aerts
{"title":"A micro-scale cost-benefit analysis of building-level flood risk adaptation measures in Los Angeles","authors":"Lars T. de Ruig , Toon Haer , Hans de Moel , W.J.Wouter Botzen , Jeroen C.J.H. Aerts","doi":"10.1016/j.wre.2019.100147","DOIUrl":"10.1016/j.wre.2019.100147","url":null,"abstract":"<div><p>Cost-benefit analysis (CBA) of flood risk adaptation strategies offers policymakers insight into economically optimal strategies for adapting to sea level rise. However, building-level adaptation measures such as floodproofing or building elevation are often evaluated at aggregated spatial scales, which may result in sub-optimal investment decisions. In this paper, we develop a flood risk model and combine it with a micro-scale CBA at the building level to obtain an optimal mix of adaptation measures per area. We apply this approach to Venice Beach in Los Angeles and Naples in Long Beach. We subsequently compare our results with the conventional, spatially aggregated area-based CBA approach. Our findings show that a mix of 35%–45% dry-floodproofing measures and 55%–65% building elevation measures is optimal. Elevation works best in areas with high inundation depths, while dry-floodproofing is preferable in areas with shallow inundation depths. The optimal mix of measures derived from our micro-scale approach results in an economic efficiency up to 85% higher than that yielded by the commonly applied spatially aggregated approach. We therefore recommend that economic evaluations of building-level adaptation measures are conducted at the smallest possible scale, or that CBAs are performed on disaggregated areas based on inundation depth.</p></div>","PeriodicalId":48644,"journal":{"name":"Water Resources and Economics","volume":"32 ","pages":"Article 100147"},"PeriodicalIF":2.2,"publicationDate":"2020-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1016/j.wre.2019.100147","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47324427","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Felipe Vásquez-Lavín , Leonardo Vargas O , José I. Hernández , Roberto D. Ponce Oliva
{"title":"Water demand in the Chilean manufacturing industry: Analysis of the economic value of water and demand elasticities","authors":"Felipe Vásquez-Lavín , Leonardo Vargas O , José I. Hernández , Roberto D. Ponce Oliva","doi":"10.1016/j.wre.2020.100159","DOIUrl":"10.1016/j.wre.2020.100159","url":null,"abstract":"<div><p><span>In this article, we estimate both the economic value of water and own-price and cross-price elasticities of water for the Chilean manufacturing industry using the production function approach. Estimating the production function allows us to estimate the marginal productivity of water which corresponds to its economic value. Our estimations are based on panel data obtained from the National Industrial Survey for the period 1995–2014, accounting for more than 10,000 industrial plants. We use a translog specification for the production function, considering water, capital, labor, energy, and intermediate material as explanatory variables. We find substitution patterns among most inputs, except for energy and water, which are found to be complements. Our results suggest that the manufacturing sector is characterized by an elastic water demand, with an average economic value of water of 8.071 [USD/m</span><sup>3</sup>]. Based on our findings, there is room to increase water prices in most sectors without affecting the competitiveness of firms. Knowing the economic value of water and its price elasticity could help policymakers to design water policies that promote more efficient use of this scarce resource.</p></div>","PeriodicalId":48644,"journal":{"name":"Water Resources and Economics","volume":"32 ","pages":"Article 100159"},"PeriodicalIF":2.2,"publicationDate":"2020-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1016/j.wre.2020.100159","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44055761","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"(g)etting to the point: The problem with water risk and uncertainty","authors":"Adam Loch, David Adamson, Christopher Auricht","doi":"10.1016/j.wre.2019.100154","DOIUrl":"10.1016/j.wre.2019.100154","url":null,"abstract":"<div><p>Where we may be aware that a problem exists, but have only an incomplete description of the drivers and/or possible management solutions, we will be unaware/uncertain about future returns from, and risks to, private and public investments in capital (i.e. social, natural, economic, cultural and political). This paper explores the unawareness/uncertainty problem by coupling Arrow's states of nature approach for dealing with uncertainty with Rothschild and Stiglitz's exploration of inputs and increasing risk. This results in a modified Just-Pope production function equation isolating inputs to i) protect base capital (natural, social or private) and/or ii) generate an output. By exploring water input supply unawareness via alternative states of nature we may identify tipping points where current technology fails, resulting in irreversible losses of private and public capital tied to water inputs. We conclude by discussing the value of quantifying minimum-input requirements and identifying critical tipping-point outcomes in water systems, increased benefits/risks from transformed landscapes chasing higher economic returns, and the need for adaptive public arrangements in response. These insights may help us to understand future risk to natural capital from rising incentives to steal increasingly constrained resources that may trigger revised risk-sharing arrangements, and some limits to analyses relying on perfect foresight requirements by decision-makers.</p></div>","PeriodicalId":48644,"journal":{"name":"Water Resources and Economics","volume":"32 ","pages":"Article 100154"},"PeriodicalIF":2.2,"publicationDate":"2020-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1016/j.wre.2019.100154","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"41655024","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Cost-effectiveness of mussel farming as a water quality improvement measure: Agricultural, environmental and market drivers","authors":"Raphael Filippelli , Mette Termansen , Berit Hasler , Karen Timmermann , Jens Kjerulf Petersen","doi":"10.1016/j.wre.2020.100168","DOIUrl":"10.1016/j.wre.2020.100168","url":null,"abstract":"<div><p><span>This study aims to understand the economic and bio-physical conditions under which mussel farming<span><span> is a cost-effective mitigation measure to improve water quality related to excess nitrogen in fjords and coastal areas. We set-up a mixed-integer optimization model including every farm in three </span>agricultural catchments surrounding Limfjorden, the largest fjord in Denmark. We include a number of relevant nitrogen abatement measures, including agricultural land-use measures and mussel farming in the sea. The aim is to model the least costly combination of mitigation measures to improve water quality when agricultural, environmental and market conditions vary. We run three scenarios varying environmental conditions for mussel productivity and market opportunities for mussel-based products as organic animal feed. We analyze the resulting marginal abatement costs and draw insights about the potential scale of mussel farming for the different catchments. We show that mussel farming is a cost-effective option for 2 of the 3 catchments, but that decreasing mussel productivity over time may make the measure ineffective for one of the catchments, if a market for feed is not available. The possibility of a market for mussel-based organic feed significantly increases the share of nitrogen reduction done by mussels and decreases overall costs by up to 65%. Ultimately, the results indicate that, for catchments where environmental conditions are adequate, mussel farming can be a cost-effective nutrient reduction measure. Therefore, mussel farming can potentially increase the cost-effectiveness of incentive schemes aimed at reducing </span></span>eutrophication in fjords and coastal waters.</p></div>","PeriodicalId":48644,"journal":{"name":"Water Resources and Economics","volume":"32 ","pages":"Article 100168"},"PeriodicalIF":2.2,"publicationDate":"2020-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1016/j.wre.2020.100168","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48848610","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
José A. Gómez-Limón, Carlos Gutiérrez-Martín, Nazaret M. Montilla-López
{"title":"Recovering water for the environment during droughts through public water banks within a monopsony-monopoly setting","authors":"José A. Gómez-Limón, Carlos Gutiérrez-Martín, Nazaret M. Montilla-López","doi":"10.1016/j.wre.2020.100163","DOIUrl":"10.1016/j.wre.2020.100163","url":null,"abstract":"<div><p><span>Allocation trade is an instrument that has been widely used to recover water for the environment during periods of scarcity (droughts). This paper proposes a water bank operating within a monopsony-monopoly setting with the dual purpose of reallocating water among farmers and acquiring water for the environment during drought periods. The proposed water bank would be managed by a public agency seeking to maximize economic efficiency generated in purchases and sales of water for agriculture<span> and the efficiency generated by the recovery of water allocations for the environment. An additional, innovative feature of the analysis performed is that it considers the inefficiencies in the economy as a whole caused by public spending on water allocation purchases, measured through the marginal cost of public funds. The potential performance of the proposed water bank is simulated by </span></span>mathematical programming techniques, taking the Guadalquivir River Basin (Southern Spain) as an empirical case study. The results provide evidence that, in terms of economic efficiency, the proposed institutional arrangement outperforms the instruments currently in place to purchase water allocations.</p></div>","PeriodicalId":48644,"journal":{"name":"Water Resources and Economics","volume":"32 ","pages":"Article 100163"},"PeriodicalIF":2.2,"publicationDate":"2020-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1016/j.wre.2020.100163","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47897411","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}