Water Scarcity in the Zambezi Basin in the Long-Term Future: A Risk Assessment

The aim of this paper is to explore possible futures for the Zambezi basin and to estimate the risks of different water management strategies. Existing uncertainties are translated into alternative assumptions. The risk of a certain management strategy, which has been developed under a given set of assumptions, is analysed by applying alternative assumptions. For the exploration of possible futures, a dynamic simulation model is used. Three ‘utopias’ and a number of ‘dystopias’ are considered. A utopia is based on a coherent set of assumptions with respect to world-view (how does the world function), management style (how do people respond) and context (exogenous developments). A dystopia evolves if some assumptions are taken differently. Using the risk assessment method described, the paper reflects on the water policy priorities earlier proposed in an expert meeting held in Harare. It is shown that in only one out of the nine cases putting the ‘Harare priorities’ into practice will work out effectively and without large tradeoffs. It is concluded that minimising risks would require a radical shift from supply towards demand policy.\u

THE ECONOMIC IMPACT OF THE SOUTH-NORTH WATER TRANSFER PROJECT IN CHINA: A COMPUTABLE GENERAL EQUILIBRIUM ANALYSIS

Water resources are unevenly spread in China. Especially the basins of the Yellow, Hui and Hai rivers in the North are rather dry. To increase the supply of water in these basins, the South-to-North Water Transfer project (SNWT) was launched. Using a computable general equilibrium model this study estimates the impact of the project on the economy of China and the rest of the world. We contrast three alternative groups of scenarios. All are directly concerned with the South-to-North water transfer project to increase water supply. In the first group of scenarios additional supply implies productivity gains. We call it the “non-market” solution. The second group of scenarios is called “market solution”. The market price for water adjusts such that supply and demand are equated again. In the third group of simulations the economic implications of China’s capital investment in infrastructure for the water South-North water transfer project is analyzed. Finally, the investment is combined with the increased capacity of water. If an increase in water supply in China leads to an increase in productivity of their water-intensive goods and services (non-market solution) this would result in a huge positive welfare effect from increased production and export. The effect on China’s welfare would still be positive, if a market for water would exist (market solution), but the world as a whole would lose. The negative effect for the rest of the world is largely explained by a deterioration of its terms-of-trade. Well functioning water markets in China are unlikely to exist.Computable General Equilibrium, South-North Water Transfer Project, Water Policy, Water Scarcity

The Economic Impact of the South-North Water Transfer Project in China: A Computable General Equilibrium Analysis

Water resources are unevenly spread in China. Especially the basins of the Yellow, Hui and Hai rivers in the North are rather dry. To increase the supply of water in these basins, the South-to-North Water Transfer project (SNWT) was launched. Using a computable general equilibrium model this study estimates the impact of the project on the economy of China and the rest of the world. We contrast three alternative groups of scenarios. All are directly concerned with the South-to-North water transfer project to increase water supply. In the first group of scenarios additional supply implies productivity gains. We call it the “non-market” solution. The second group of scenarios is called “market solution”. The market price for water adjusts such that supply and demand are equated again. In the third group of simulations the economic implications of China’s capital investment in infrastructure for the water South-North water transfer project is analyzed. Finally, the investment is combined with the increased capacity of water. If an increase in water supply in China leads to an increase in productivity of their water-intensive goods and services (non-market solution) this would result in a huge positive welfare effect from increased production and export. The effect on China’s welfare would still be positive, if a market for water would exist (market solution), but the world as a whole would lose. The negative effect for the rest of the world is largely explained by a deterioration of its terms-of-trade. Well functioning water markets in China are unlikely to exist.Computable General Equilibrium, South-North Water Transfer Project, Water Policy, Water Scarcity

Vertical Coordination in the Pork and Broiler Industries: Implications for Pork and Chicken Products

Recent changes in structure of the U.S. pork industry reflect, in many ways, past changes in the broiler industry. Production contracts and vertical integration in the broiler industry facilitated rapid adoption of new technology, improved quality control, assured market outlets for broilers, and provided a steady flow of broilers for processing. Affordable, high-quality chicken products have contributed to continual increases in U.S. chicken consumption, which has surpassed pork and beef on a per capita basis. Incentives for contracting and vertical integration in the pork industry may yield comparable results. If so, these arrangements might be expected to result in larger supplies of higher quality pork products at economical prices.vertical coordination, vertical integration, contracts, transaction costs, technology, chicken, pork, Livestock Production/Industries,

Governance and Water Management: Progress and Tools in Mediterranean Countries

This paper reviews the progress with respect to Integrated Water Resource Management (IWRM) in Mediterranean countries, as addressed within the activities of the Nostrum-Dss project, a Coordination Action funded by the 6th Framework Programme of the EC, with a particular emphasis on the current use of decision support tools (DSS). The IWRM paradigm is a comprehensive management framework, which integrates the different aspects of water resources – from the underlying ecological and physical aspects, to the socio-economic values and needs (horizontal integration); and calls for increasing decentralisation and privatisation of water services (vertical integration), and the devolution of planning authority, without however forgetting the need to ensure equitable access to water resources. Substantial progress has been made in the last decades in Nostrum-Dss Partner countries, although a disparity can still be seen between the Northern and Southern banks. New institutions have been established for implementing IWRM, existing institutions have been reformed, and decision making processes increasingly require public participation. Decentralisation of decision making, implementation and monitoring are also well underway, although improvements are still needed to ensure that the traditional power structures do not prevail. More efficient technologies and infrastructures are in place, especially for the production of high value goods or in agriculture. Finally, several DSS have been developed: yet, while operational/technical DSS instruments have been successfully employed, DSSs tools developed in a participatory way, or tackling more complex, political as well as environmental and economic problems are still de-linked from actual decision making processes. Laws and regulations for water management in most Mediterranean countries embrace and support the paradigms of IWRM – and EU framework directives have played an important role in fostering this shift from more traditional, vertical governance to new, horizontal governance based on soft laws. Yet, the implementation of such laws and regulations is often only partial – often because of the lack of a clear monitoring and enforcement strategy, but also because of governments’ financial and human resources constraints. Strong overlaps of roles and competences among different government institutions remain, hampering effective implementation of water management. The tendency to centralisation of decision making persists, and actors’ involvement is scanty. The shift towards the use of demand side policies as opposed to supply side policies is not yet completed: yet, supply side policies are very costly, as they are based on greater mobilisation of financial resources. Full cost recovery pricing is not practiced widely. This reluctance to introduce full cost recovery pricing in developing countries may be due to ethical and moral considerations, but in developed countries it is often associated with strong lobbying power of interest groups. This study was supported by funding under the Sixth Research Framework of the European Union within the project "Network on Governance, Science and Technology for Sustainable Water Resource Management in the Mediterranean- The role of Dss tools” (NOSTRUM-Dss, contract number INCO-CT-2004-509158).Integrated Water Resources Management, Decision Support Systems, Environmental Governance

Integrated Scenarios of Regional Development in Two Semi-Arid States of North-Eastern Brazil

Scenario analysis of the future is an important tool for supporting sustainability-oriented regional planning. To assist regional planning in two federal states in semi-arid North-eastern Brazil, Ceará and Piauí, we developed integrated qualitative¿quantitative scenarios that show potential developments of the agricultural and water resources situation as well as the internal migration until the year 2025. In these states, regional development is negatively influenced by the high seasonality of rainfall and El-Niño-related drought years. Two reference scenarios, 'Coastal Boom and Cash Crops' and 'Decentralisation - Integrated Rural Development' were developed. First, story lines were created and the development of the driving forces was quantified. Then, an integrated model, which includes modules for simulating water availability, water demand, and agricultural production and income, was applied to compute the temporal development of relevant system indicators in each of the 332 municipalities of Ceará and Piauí. These indicators encompass the fraction of the irrigation water demand than can be satisfied, the volume of water which is stored in the reservoirs at the beginning of the dry season, agricultural productivity and production as well as the internal migration among scenario regions. In addition, the impact of certain policy measures was assessed in the context of both reference scenarios. Reference and intervention scenarios were derived by an interdisciplinary group of scientists and were discussed and refined during policy workshops with planning agencies of Ceará

INVESTING IN FARM WORKER HOUSING: A MULTI-SEASON PEAK-LOAD ANALYSIS OF WASHINGTON STATE DATA

This paper develops cost effective investment rules for farm worker housing and applies the model to farm worker housing in the state of Washington. The state must meet varying seasonal farm worker housing needs at minimum expense. In this study we examine investment rules to choose among different housing technologies in order to minimize the total costs of housing consistent with achieving welfare goals. The research extends existing peak-load models to the multi-season planning cycle case and applies the approach empirically to a new subject area.Labor and Human Capital,

The Role of Economic Instruments to Resolve Water Quantity Problems

Resource /Energy Economics and Policy,