IDEAS home Printed from https://ideas.repec.org/a/spr/waterr/v23y2009i8p1467-1478.html
   My bibliography  Save this article

Evaluating and Predicting Shadow Prices of Water Resources in China and Its Nine Major River Basins

Author

Listed:
  • Xiuli Liu
  • Xikang Chen
  • Shouyang Wang

Abstract

Water pricing plays a crucial role in water resources management. Water shadow price is an important reference in setting water price. It was said that in practice it is almost impossible to obtain water shadow price by solving a linear programming model. In this paper we use water conservancy economy input-occupancy-output tables of the nine Chinese major river basins, and combining input–output analysis method with linear programming method we develop a linear programming model with restrictions on the final demand, total output, trade balance and water availability. We estimate the water shadow prices for industrial water and productive water for the nine Chinese major river basins in 1999 and compared these results with the real industrial water price in China in 1999. Then, for operational purposes and to estimate the shadow prices of industrial water and productive water more easily, and using a Gauss–Newton nonlinear simulation method, we present two nonlinear models that relate the ratio of the volume of water used to the total water resources volume with the shadow prices to predict shadow prices of industrial water and productive water in 2020 and 2030 in China and its nine major river basins. Copyright Springer Science+Business Media B.V. 2009

Suggested Citation

  • Xiuli Liu & Xikang Chen & Shouyang Wang, 2009. "Evaluating and Predicting Shadow Prices of Water Resources in China and Its Nine Major River Basins," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 23(8), pages 1467-1478, June.
    • Handle: RePEc:spr:waterr:v:23:y:2009:i:8:p:1467-1478
    DOI: 10.1007/s11269-008-9336-7
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s11269-008-9336-7
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11269-008-9336-7?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Ioslovich, Ilya & Gutman, Per-Olof, 2001. "A model for the global optimization of water prices and usage for the case of spatially distributed sources and consumers," Mathematics and Computers in Simulation (MATCOM), Elsevier, vol. 56(4), pages 347-356.
    2. Kumiko Kondo, 2005. "Economic analysis of water resources in Japan: using factor decomposition analysis based on input-output tables," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 7(2), pages 109-129, June.
    3. Jihad Elnaboulsi, 2001. "Nonlinear pricing and capacity planning for water and wastewater services," Post-Print hal-00447925, HAL.
    4. J. Elnaboulsi, 2001. "Nonlinear Pricing and Capacity Planning for Water and Wastewater Services," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 15(1), pages 55-69, February.
    5. Julie A. Hewitt & W. Michael Hanemann, 1995. "A Discrete/Continuous Choice Approach to Residential Water Demand under Block Rate Pricing," Land Economics, University of Wisconsin Press, vol. 71(2), pages 173-192.
    6. Corral, Leonardo & Fisher, Anthony C. & Hatch, Nile W., 1998. "Price And Non-Price Influences On Water Conservation: An Econometric Model Of Aggregate Demand Under Nonlinear Budget Constraint," 1998 Annual meeting, August 2-5, Salt Lake City, UT 20958, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    7. Berrittella, Maria & Rehdanz, Katrin & Roson, Roberto & Tol, Richard S.J., 2007. "The Economic Impact of Water Taxes: A Computable General Equilibrium Analysis with an International Data Set," Conference papers 331655, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    8. Michael L. Nieswiadomy & David J. Molina, 1989. "Comparing Residential Water Demand Estimates under Decreasing and Increasing Block Rates Using Household Data," Land Economics, University of Wisconsin Press, vol. 65(3), pages 280-289.
    9. Maria Berrittella & Katrin Rehdanz & Roberto Roson & Richard S.J. Tol, 2006. "The Economic Impact Of Water Pricing: A Computable General Equilibrium Analysis," Working Papers FNU-96, Research unit Sustainability and Global Change, Hamburg University, revised Jan 2006.
    10. Kaiser, Brooks & Roumasset, James, 2002. "Valuing indirect ecosystem services: the case of tropical watersheds," Environment and Development Economics, Cambridge University Press, vol. 7(4), pages 701-714, October.
    11. Chuang-lin Fang & Chao Bao & Jin-chuan Huang, 2007. "Management Implications to Water Resources Constraint Force on Socio-economic System in Rapid Urbanization: A Case Study of the Hexi Corridor, NW China," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 21(9), pages 1613-1633, September.
    12. David L. Chicoine & Ganapathi Ramamurthy, 1986. "Evidence on the Specification of Price in the Study of Domestic Water Demand," Land Economics, University of Wisconsin Press, vol. 62(1), pages 26-32.
    13. Ellen M. Pint, 1999. "Household Responses to Increased Water Rates during the California Drought," Land Economics, University of Wisconsin Press, vol. 75(2), pages 246-266.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Zihan Guo & Ni Wang & Xiaolian Mao & Xinyue Ke & Shaojiang Luo & Long Yu, 2022. "Benefit Analysis of Economic and Social Water Supply in Xi’an Based on the Emergy Method," Sustainability, MDPI, vol. 14(9), pages 1-20, April.
    2. Fernando Arbués & Maria García-Valiñas & Inmaculada Villanúa, 2010. "Urban Water Demand for Service and Industrial Use: The Case of Zaragoza," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 24(14), pages 4033-4048, November.
    3. Junyuan Shen & Fengping Wu & Qianwen Yu & Zhaofang Zhang & Lina Zhang & Min Zhu & Zhou Fang, 2020. "Standardization of Exchanged Water with Different Properties in China’s Water Rights Trading," IJERPH, MDPI, vol. 17(5), pages 1-19, March.
    4. Shahbaz Mushtaq, 2012. "Exploring Synergies Between Hardware and Software Interventions on Water Savings in China: Farmers’ Response to Water Usage and Crop Production," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 26(11), pages 3285-3300, September.
    5. Schneider, Kate R., 2022. "Nationally representative estimates of the cost of adequate diets, nutrient level drivers, and policy options for households in rural Malawi," Food Policy, Elsevier, vol. 113(C).
    6. Li Jiang & Feng Wu & Yu Liu & Xiangzheng Deng, 2014. "Modeling the Impacts of Urbanization and Industrial Transformation on Water Resources in China: An Integrated Hydro-Economic CGE Analysis," Sustainability, MDPI, vol. 6(11), pages 1-15, October.
    7. Josef Slaboch & Lukáš Čechura & Michal Malý & Jiří Mach, 2022. "The Shadow Values of Soil Hydrological Properties in the Production Potential of Climatic Regionalization of the Czech Republic," Agriculture, MDPI, vol. 12(12), pages 1-21, December.
    8. Schneider, Kate, 2021. "Nationally Representative Estimates of the Cost of Adequate Diets, Nutrient Level Drivers, and Policy Options for Households in Rural Malawi," 2021 Conference, August 17-31, 2021, Virtual 315035, International Association of Agricultural Economists.
    9. Qing Zhou & Yali Zhang & Feng Wu, 2022. "Can Water Price Improve Water Productivity? A Water-Economic-Model-Based Study in Heihe River Basin, China," Sustainability, MDPI, vol. 14(10), pages 1-18, May.
    10. Aixi Han & Ao Liu & Zhenshan Guo & Yi Liang & Li Chai, 2023. "Measuring Gains and Losses in Virtual Water Trade from Environmental and Economic Perspectives," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 85(1), pages 195-209, May.
    11. Fu, Xue & Lahr, Michael & Yaxiong, Zhang & Meng, Bo, 2017. "Actions on climate change, Intended Reducing carbon emissions in China via optimal industry shifts: Toward hi-tech industries, cleaner resources and higher carbon shares in less-develop regions," Energy Policy, Elsevier, vol. 102(C), pages 616-638.
    12. Ziolkowska, Jadwiga R., 2015. "Shadow price of water for irrigation—A case of the High Plains," Agricultural Water Management, Elsevier, vol. 153(C), pages 20-31.
    13. Valeria Di Cosmo, 2011. "Are the Consumers Always Ready to Pay? A Quasi-Almost Ideal Demand System for the Italian Water Sector," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 25(2), pages 465-481, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Arbues, Fernando & Garcia-Valinas, Maria Angeles & Martinez-Espineira, Roberto, 2003. "Estimation of residential water demand: a state-of-the-art review," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 32(1), pages 81-102, March.
    2. R. Martinez-Espiñeira, 2002. "Residential Water Demand in the Northwest of Spain," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 21(2), pages 161-187, February.
    3. Valeria Di Cosmo, 2011. "Are the Consumers Always Ready to Pay? A Quasi-Almost Ideal Demand System for the Italian Water Sector," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 25(2), pages 465-481, January.
    4. Darío F. Jiménez & Sergio A. Orrego & Felipe A. Vásquez & Roberto D. Ponce, 2017. "Estimating water demand for urban residential use using a discrete-continuous model and disaggregated data at the household level: the case of the city of Manizales, Colombia," Lecturas de Economía, Universidad de Antioquia, Departamento de Economía, issue 86, pages 153-178, Enero - J.
    5. Andrew C. Worthington & Mark Hoffman, 2008. "An Empirical Survey Of Residential Water Demand Modelling," Journal of Economic Surveys, Wiley Blackwell, vol. 22(5), pages 842-871, December.
    6. Jiménez, Darío F. & Orrego, Sergio A. & Vásquez, Felipe A. & Ponce, Roberto D., 2016. "Estimación de la demanda de agua para uso residencial urbano usando un modelo discreto-continuo y datos desagregados a nivel de hogar: el caso de la ciudad de Manizales, Colombia," Revista Lecturas de Economía, Universidad de Antioquia, CIE, issue 86, pages 153-178, December.
    7. Dinusha Dharmaratna & Edwyna Harris, 2012. "Estimating Residential Water Demand Using the Stone-Geary Functional Form: The Case of Sri Lanka," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 26(8), pages 2283-2299, June.
    8. Roberto Martínez-Espiñeira, 2007. "An Estimation of Residential Water Demand Using Co-Integration and Error Correction Techniques," Journal of Applied Economics, Taylor & Francis Journals, vol. 10(1), pages 161-184, May.
    9. Dinusha Dharmaratna & Edwyna Harris, 2010. "Estimating Residential Water Demand using the Stone-Geary Functional Form: the Case of Sri Lanka," Monash Economics Working Papers 46-10, Monash University, Department of Economics.
    10. Ruijs, A. & Zimmermann, A. & van den Berg, M., 2008. "Demand and distributional effects of water pricing policies," Ecological Economics, Elsevier, vol. 66(2-3), pages 506-516, June.
    11. Ming-Feng Hung & Bin-Tzong Chie, 2013. "Residential Water Use: Efficiency, Affordability, and Price Elasticity," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 27(1), pages 275-291, January.
    12. Olmstead, Sheila M. & Michael Hanemann, W. & Stavins, Robert N., 2007. "Water demand under alternative price structures," Journal of Environmental Economics and Management, Elsevier, vol. 54(2), pages 181-198, September.
    13. Arjan Ruijs, 2007. "Welfare and Distribution Effects of Water Pricing Policies," Working Papers 2007.92, Fondazione Eni Enrico Mattei.
    14. Mónica Maldonado-Devis & Vicent Almenar-Llongo, 2021. "A Panel Data Estimation of Domestic Water Demand with IRT Tariff Structure: The Case of the City of Valencia (Spain)," Sustainability, MDPI, vol. 13(3), pages 1-26, January.
    15. Stavins, Robert & Hanemann, W. Michael & Olmstead, Sheila, 2005. "Do Consumers React to the Shape of Supply? Water Demand under Heterogeneous Price Structures," RFF Working Paper Series dp-05-29, Resources for the Future.
    16. Diakité, Daouda & Thomas, Alban, 2011. "La demande domestique d’eau potable : une étude sur un panel de communes ivoiriennes," L'Actualité Economique, Société Canadienne de Science Economique, vol. 87(3), pages 269-299, septembre.
    17. Tamkinat Rauf & M. Wasif Siddiqi, 2008. "Price-setting for Residential Water: Estimation of Water Demand in Lahore," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 47(4), pages 893-906.
    18. Daniel A. Brent, 2016. "Estimating Water Demand Elasticity at the Intensive and Extensive Margin," Departmental Working Papers 2016-06, Department of Economics, Louisiana State University.
    19. Jasper M. Dalhuisen & Raymond J.G.M. Florax & Henri L.F.M. de Groot & Peter Nijkamp, 2001. "Price and Income Elasticities of Residential Water Demand: Why Empirical Estimates differ," Tinbergen Institute Discussion Papers 01-057/3, Tinbergen Institute.
    20. R. Martínez-Espiñeira, 2003. "Estimating Water Demand under Increasing-Block Tariffs Using Aggregate Data and Proportions of Users per Block," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 26(1), pages 5-23, September.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:waterr:v:23:y:2009:i:8:p:1467-1478. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.