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Water 2018, 10(10), 1442; https://doi.org/10.3390/w10101442

Global Economic and Food Security Impacts of Demand-Driven Water Scarcity—Alternative Water Management Options for a Thirsty World

UCL Institute for Sustainable Resources, 14 Upper Woburn Place, London WC1H 0NN, UK
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Received: 14 August 2018 / Revised: 21 September 2018 / Accepted: 9 October 2018 / Published: 13 October 2018
(This article belongs to the Special Issue Hydroeconomic Analysis for Sustainable Water Management)
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Abstract

Global freshwater demand will likely continue its expansion under current expectations of economic and population growth. Withdrawals in regions which are already water-scarce will impose further pressure on the renewable water resource base threatening the long-term availability of freshwater across the many economic activities dependent on this resource for various functions. This paper assesses the economy-wide implications of demand-driven water scarcity under a ‘middle-of-the-road’ socio-economic development pathway by considering the trade-offs between the macroeconomic and food security impacts. The study employs a global CGE model comprising an advanced level of detail regarding water uses across economic activities and which allows for a sector-specific endogenous adaptation to water scarcity. A sustainable withdrawal threshold is imposed in regions with extended river-basin overexploitation (India, South Asia, the Middle East, and Northern Africa) whilst different water management options are considered through four alternative allocation methods across users. The scale of macroeconomic effects is dependent on the relative size of sectors with low-water productivity, the amount of water uses in these sectors, and the flexibility of important water users to substitute away from water inputs in conditions of scarcity. The largest negative GDP deviations are obtained in scenarios with limited mobility to re-allocate water across users. A significant alleviation is obtained when demand patterns are shifted based on differences in water productivity, however, with a significant imposition on food security prospects. View Full-Text
Keywords: computable general equilibrium; water allocation; water scarcity; food security; hydroeconomic assessment; virtual water computable general equilibrium; water allocation; water scarcity; food security; hydroeconomic assessment; virtual water
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Nechifor, V.; Winning, M. Global Economic and Food Security Impacts of Demand-Driven Water Scarcity—Alternative Water Management Options for a Thirsty World. Water 2018, 10, 1442.

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