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Economic impacts of alternative water policy scenarios in the Spanish production system: an input-output analysis

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  • Llop Llop, Maria

Abstract

The objective of this paper is to analyse the economic impacts of alternative water policies implemented in the Spanish production system. The methodology uses two versions of the input-output price model: a competitive formulation and a mark-up formulation. The input-output framework evaluates the impact of water policy measures on production prices, consumption prices, intermediate water demand and private welfare. Our results show that a tax on the water used by sectors considerably reduces the intermediate water demand, and increases the production and consumption prices. On the other hand, according to Jevons' paradox, an improvement in technical efficiency, which leads to a reduction in the water requirements of all sectors and an increase in water production, increases the amount of water consumed. The combination of a tax on water and improved technical efficiency takes the pressure off prices and significantly reduces intermediate water demand. JEL Classification: C67 ; D57 ; Q25. Keywords: Production prices; Consumption prices; Water uses; Water policy; Water taxation.

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  • Llop Llop, Maria, 2006. "Economic impacts of alternative water policy scenarios in the Spanish production system: an input-output analysis," Working Papers 2072/3681, Universitat Rovira i Virgili, Department of Economics.
    • Handle: RePEc:urv:wpaper:2072/3681
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    Cited by:

    1. Altvater, Susanne & de Block, Debora & Bouwma, Irene & Dworak, Thomas & Frelih-Larsen, Ana & Görlach, Benjamin & Hermeling, Claudia & Klostermann, Judith & König, Martin & Leitner, Markus & Marinova, , 2012. "Adaptation measures in the EU: Policies, costs, and economic assessment. "Climate Proofing" of key EU policies," ZEW Expertises, ZEW - Leibniz Centre for European Economic Research, number 110558.
    2. Llop, Maria & Pié, Laia, 2008. "Input-output analysis of alternative policies implemented on the energy activities: An application for Catalonia," Energy Policy, Elsevier, vol. 36(5), pages 1642-1648, May.
    3. Alexandros Gkatsikos & Konstadinos Mattas, 2021. "The Paradox of the Virtual Water Trade Balance in the Mediterranean Region," Sustainability, MDPI, vol. 13(5), pages 1-14, March.
    4. Ouyang, Jinlong & Long, Enshen & Hokao, Kazunori, 2010. "Rebound effect in Chinese household energy efficiency and solution for mitigating it," Energy, Elsevier, vol. 35(12), pages 5269-5276.
    5. Carlos A. L�pez-Morales & Faye Duchin, 2015. "Economic Implications Of Policy Restrictions On Water Withdrawals From Surface And Underground Sources," Economic Systems Research, Taylor & Francis Journals, vol. 27(2), pages 154-171, June.
    6. Cristian Mardones & Tamara Muñoz, 2018. "Environmental taxation for reducing greenhouse gases emissions in Chile: an input–output analysis," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 20(6), pages 2545-2563, December.
    7. Amine Chekireb & Julio Goncalves & Hubert Stahn & Agnes Tomini, 2021. "Private exploitation of the North-Western Sahara Aquifer System," AMSE Working Papers 2144, Aix-Marseille School of Economics, France.
    8. Ivana Logar & Jeroen Bergh, 2013. "Methods to Assess Costs of Drought Damages and Policies for Drought Mitigation and Adaptation: Review and Recommendations," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 27(6), pages 1707-1720, April.
    9. Alexandros Gkatsikos & Konstadinos Mattas & Efstratios Loizou & Dimitrios Psaltopoulos, 2022. "The Neglected Water Rebound Effect of Income and Employment Growth," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 36(1), pages 379-398, January.
    10. Xu, Tang & Baosheng, Zhang & Lianyong, Feng & Masri, Marwan & Honarvar, Afshin, 2011. "Economic impacts and challenges of China’s petroleum industry: An input–output analysis," Energy, Elsevier, vol. 36(5), pages 2905-2911.
    11. Abdeslam Boudhar & Said Boudhar & Aomar Ibourk, 2017. "An input–output framework for analysing relationships between economic sectors and water use and intersectoral water relationships in Morocco," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 6(1), pages 1-25, December.
    12. Pei-Ing Wu & Je-Liang Liou & Ta-Ken Huang, 2022. "Evaluation of Benefits and Health Co-Benefits of GHG Reduction for Taiwan’s Industrial Sector under a Carbon Charge in 2023–2030," IJERPH, MDPI, vol. 19(22), pages 1-24, November.
    13. Rui Huang & Klaus Hubacek & Kuishuang Feng & Xiaojie Li & Chao Zhang, 2018. "Re-Examining Embodied SO 2 and CO 2 Emissions in China," Sustainability, MDPI, vol. 10(5), pages 1-17, May.
    14. C. D. Pérez-Blanco & E. E. Koks & E. Calliari & J. Mysiak, 2018. "Economic Impacts of Irrigation-Constrained Agriculture in the Lower Po Basin," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 4(01), pages 1-38, January.
    15. Han, M.Y. & Chen, G.Q. & Mustafa, M.T. & Hayat, T. & Shao, Ling & Li, J.S. & Xia, X.H. & Ji, Xi, 2015. "Embodied water for urban economy: A three-scale input–output analysis for Beijing 2010," Ecological Modelling, Elsevier, vol. 318(C), pages 19-25.
    16. Aurélien Dumont & Beatriz Mayor & Elena López-Gunn, 2013. "Is the rebound effect or Jevons paradox a useful concept for better management of water resources? Insights from the Irrigation Modernisation Process in Spain," Post-Print halshs-00991778, HAL.
    17. Laia Pié Dols & Maria Llop Llop, 2007. "Economic Impact of Alternative Policy Measures Implemented on the Energy Activities of the Catalan Production System: an Input-output Analysis," Energy and Environmental Modeling 2007 24000050, EcoMod.
    18. Hossein Mirshojaeian Hosseini & Shinji Kaneko, 2012. "A general equilibrium analysis of the inflationary impact of energy subsidies reform in Iran," IDEC DP2 Series 2-8, Hiroshima University, Graduate School for International Development and Cooperation (IDEC).
    19. Carmen Ramos Carvajal & Ana Salomé García-Muñiz & Blanca Moreno Cuartas, 2019. "Assessing Socioeconomic Impacts of Integrating Distributed Energy Resources in Electricity Markets through Input-Output Models," Energies, MDPI, vol. 12(23), pages 1-21, November.
    20. Mardones, Cristian & Velásquez, Andrés, 2021. "Macroeconomic, intersectoral, and environmental effects of R&D subsidies in Chile: An input-output approach," Technological Forecasting and Social Change, Elsevier, vol. 173(C).
    21. Zhang, Hongxia & Hewings, Geoffrey J.D. & Zheng, Xinye, 2019. "The effects of carbon taxation in China: An analysis based on energy input-output model in hybrid units," Energy Policy, Elsevier, vol. 128(C), pages 223-234.
    22. Ortuzar, Iban & Serrano, Ana & Xabadia, Àngels, 2023. "Macroeconomic impacts of water allocation under droughts. Accounting for global supply chains in a multiregional context," Ecological Economics, Elsevier, vol. 211(C).

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    More about this item

    Keywords

    Preus; Consum (Economia); Aigua-Utilització; Aigua-Polítiques de gestió; Aigua-Impostos;
    All these keywords.

    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water

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