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What is Wrong with Virtual Water Trading? On the Limitations of the Virtual Water Concept

Author

Listed:
  • Erik Gawel

    (Helmholtz Centre for Environmental Research, Permoserstraße 15, 04318 Leipzig, Germany)

  • Kristina Bernsen

    (Universitat Leipzig, Institut für Infrastruktur und Ressourcenmanagement Grimmaische, Straße 12, 04109 Leipzig, Germany)

Abstract

Virtual water, the amount of water used along a good's value chain, has come under discussion. Fairness and efficiency problems are seen to arise in the reallocation of access to water resources through the means of international trade. Moral issues are attached to both imports and exports, and even to a country's own consumption of virtual water. Global institutional arrangements have therefore been suggested to regulate virtual water trade both efficiently and ‘fairly’. With this paper we will provide a short overview of the concept's history and findings, and an analysis from the perspective of economic trade theory, bringing up the old debate about the economic and environmental merits of free trade. The contribution of this paper will be to examine the performance of virtual water concepts in advising business or policy decisions in the form of global governance arrangements. It must be concluded that the virtual water concept is limited in terms of its usefulness in providing policy advice. The usually applied normative criteria are inconsistent, implying governance schemes that improve neither efficiency nor sustainability Water-related problems should be solved in the respective arenas and not by global governance schemes or trade barriers.

Suggested Citation

  • Erik Gawel & Kristina Bernsen, 2013. "What is Wrong with Virtual Water Trading? On the Limitations of the Virtual Water Concept," Environment and Planning C, , vol. 31(1), pages 168-181, February.
    • Handle: RePEc:sae:envirc:v:31:y:2013:i:1:p:168-181
    DOI: 10.1068/c11168
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    References listed on IDEAS

    as
    1. Wichelns, Dennis, 2004. "The policy relevance of virtual water can be enhanced by considering comparative advantages," Agricultural Water Management, Elsevier, vol. 66(1), pages 49-63, April.
    2. M. Kumar & O. Singh, 2005. "Virtual Water in Global Food and Water Policy Making: Is There a Need for Rethinking?," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 19(6), pages 759-789, December.
    3. Esther Velázquez & Cristina Madrid & María Beltrán, 2011. "Rethinking the Concepts of Virtual Water and Water Footprint in Relation to the Production–Consumption Binomial and the Water–Energy Nexus," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 25(2), pages 743-761, January.
    4. Dik Roth & Jeroen Warner, 2008. "Virtual water: Virtuous impact? The unsteady state of virtual water," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 25(2), pages 257-270, June.
    5. repec:iwt:rerpts:h035342 is not listed on IDEAS
    6. Ansink, Erik, 2010. "Refuting two claims about virtual water trade," Ecological Economics, Elsevier, vol. 69(10), pages 2027-2032, August.
    7. Jeroen C.J.M. van den Bergh, 2000. "Ecological Economics: Themes, Approaches, and Differences with Environmental Economics," Tinbergen Institute Discussion Papers 00-080/3, Tinbergen Institute.
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    Cited by:

    1. Arjen Y. Hoekstra, 2017. "Water Footprint Assessment: Evolvement of a New Research Field," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 31(10), pages 3061-3081, August.
    2. Beltrán, María J. & Kallis, Giorgos, 2018. "How Does Virtual Water Flow in Palestine? A Political Ecology Analysis," Ecological Economics, Elsevier, vol. 143(C), pages 17-26.

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