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Modelling basin level allocation of water in the Murray Darling Basin in a world of uncertainty

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Author Info

  • David Adamson

    ()
    (Risk and Sustainable Management Group, University of Queensland)

  • Thilak Mallawaarachchi

    ()
    (Risk and Sustainable Management Group, University of Queensland)

  • John Quiggin

    ()
    (Risk & Sustainable Management Group, School of Economics, University of Queensland)

Abstract

The Murray-Darling Basin comprises over 1 million km2; it lies within four states and one territory; and over 12, 800 GL of irrigation water is used to produce over 40% of the nation's gross value of agricultural production. This production is used by a diverse collection of some-times mutually exclusive commodities (e.g. pasture; stone fruit; grapes; cotton and field crops). The supply of water for irrigation is subject to climatic and policy uncertainty. Variable inflows mean that water property rights do not provide a guaranteed supply. With increasing public scrutiny and environmental issues facing irrigators, greater pressure is being placed on this finite resource. The uncertainty of the water supply, water quality (salinity), combined with where water is utilised, while attempting to maximising return for investment makes for an interesting research field. The utilisation and comparison of a GAMS and Excel based modelling approach has been used to ask: where should we allocate water?; amongst what commodities?; and how does this affect both the quantity of water and the quality of water along the Murray-Darling river system?

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Bibliographic Info

Paper provided by Risk and Sustainable Management Group, University of Queensland in its series Murray-Darling Program Working Papers with number WPM05_1.

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Date of creation: Feb 2005
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Handle: RePEc:rsm:murray:m05_1

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Keywords: Water; Uncertainty; Salinity; GAMS v EXCEL & Optimisation;

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  1. Quiggin, John & Chambers, Robert G, 2003. "Drought Policy: A State-contingent View," Risk and Sustainable Management Group Working Papers 149836, University of Queensland, School of Economics.
  2. Svend Rasmussen, 2003. "Criteria for optimal production under uncertainty. The state-contingent approach," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 47(4), pages 447-476, December.
  3. C.J. O'Donnell & W.E. Griffiths, 2004. "Estimating State-Contingent Production Frontiers," Department of Economics - Working Papers Series 911, The University of Melbourne.
  4. Quiggin, John C., 1991. "Salinity Mitigation in the Murray River System," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 59(01), April.
  5. Hall, Nigel H. & Mallawaarachchi, Thilak & Batterham, Robert L., 1991. "The Market for Irrigation Water: A Modelling Approach," 1991 Conference (35th), February 11-14, 1991, Armidale, Australia 145889, Australian Agricultural and Resource Economics Society.
  6. Chambers, Robert G. & Quiggin, John C., 2004. "Technological and financial approaches to risk management in agriculture: an integrate approach," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 48(2), June.
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