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Assessing Ecological Infrastructure Investments—A Case Study of Water Rights Trading in Lu’an City, Anhui Province, China

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  • Qiuyan Wang

    (College of Economics and Management, Nanjing Forestry University, Nanjing 210037, China)

  • Qingjian Zhao

    (College of Economics and Management, Nanjing Forestry University, Nanjing 210037, China)

Abstract

Investment in ecological infrastructure construction alters behaviors and quantities of the ecosystem service (ES) provided, and market-clearing can learn the value and scale of ES. We integrated ecological and economic methods to put forward the idea of realizing the aquatic ecological products’ value by investing in water-saving irrigation infrastructure. Firstly, the demand for aquatic ecological products was calculated by a Cobb–Douglas production function, and then the supply of aquatic ecological products was estimated by InVEST and water-saving potential models; Finally, the scale of ecological infrastructure investment and the aquatic ecological products’ value are illustrated by cost-benefit analysis and market equilibrium theory. Research indicates that, (1) industrial water efficiency is high, and the ecological infrastructure construction provides a considerable number of ecological products; (2) implementing water-saving irrigation project is at least 30% more profitable than maintaining the status quo; (3) the market-clearing results showed that the market equilibrium price is about 0.256 USD/m 3 , and the transaction volume is about 1.667 billion m 3 . The output value of industrial enterprises after buying water can reach about 1.37 times of the current stage, reflecting the aquatic ecological products’ value. Investment in water-saving irrigation infrastructure has huge economic, social and ecological benefits, and provides reference for decision-making.

Suggested Citation

  • Qiuyan Wang & Qingjian Zhao, 2022. "Assessing Ecological Infrastructure Investments—A Case Study of Water Rights Trading in Lu’an City, Anhui Province, China," IJERPH, MDPI, vol. 19(4), pages 1-23, February.
    • Handle: RePEc:gam:jijerp:v:19:y:2022:i:4:p:2443-:d:753935
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    2. Zhen Yu & Qingjian Zhao, 2022. "Research on the Coordinated Governance Mechanism of Cross-Regional and Cross-Basin Ecological Compensation in the Yangtze River Delta," IJERPH, MDPI, vol. 19(16), pages 1-20, August.

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