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Trade-offs in water policy: System-wide implications of changing water availability and agricultural productivity in the Mediterranean economies by 2050

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  • Roson, Roberto
  • Sartori, Martina

Abstract

We evaluate the structural consequences of water availability scenarios in the Mediterranean, following a bottom-up methodology. This includes an assessment of future water availability and a general equilibrium analysis of changes in agricultural productivity. Lower productivity in agriculture, induced by reduced water availability, generates negative consequences in terms of real income and welfare. The magnitude of the loss depends on the amount of the productivity shock, but also on the share of agricultural activities in the economy and on the stringency of the environmental regulation. Our results suggest that countries in Middle East and North Africa could respond to increasing water scarcity by accepting, to some extent, lower environmental quality (deterioration of aquatic environments). Furthermore, improvements in water efficiency appear to curb the economic impact of water scarcity quite significantly, especially for northern Mediterranean countries.

Suggested Citation

  • Roson, Roberto & Sartori, Martina, 2013. "Trade-offs in water policy: System-wide implications of changing water availability and agricultural productivity in the Mediterranean economies by 2050," Conference papers 332416, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:332416
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    References listed on IDEAS

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    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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