We used that GTAP-W model – GTAP5 with water resources added – to estimate the impact of hypothetical Doha-like liberalization of agricultural trade on water use. Three conclusions emerge. First, the change in regional water use is less than 10%, even if agricultural tariffs are reduced by 75%. Second, patterns are non-linear. Water use may go up for partial liberalization, and down for more complete liberalization. This is because different crops respond differently to tariff reductions, but also because trade and competition matter too. Third, trade liberalization tends to reduce water use in water scarce regions, and increase water use in water abundant regions, even though there no water markets in most countries.
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Paper provided by Research unit Sustainability and Global Change, Hamburg University in its series Working Papers with number
FNU-142.
Find related papers by JEL classification: D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
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Anthony Letsoalo & James Blignaut & Theuns de Wet & Martin de Wit & Sebastiaan Hess & Richard S.J. Tol & Jan van Heerden, 2005.
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FNU-62, Research unit Sustainability and Global Change, Hamburg University, revised Apr 2005.
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Kenneth M. Strzepek & Gary W. Yohe & Richard S.J. Tol & Mark Rosegrant, 2006.
"The Value Of The High Aswan Dam To The Egyptian Economy,"
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FNU-111, Research unit Sustainability and Global Change, Hamburg University, revised Jun 2006.
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