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Impacts of Reallocation of Resource Constraints on the Northeast Economy of Brazil

Author

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  • Geoffrey Hewings

    ()

  • Chokri Dridi

    ()

  • Joaquim Guilhoto

    ()

Abstract

The present paper explores the role of water and energy resource constraints and allocation on the Northeast Brazil economy. The analysis centered on the creation of an intergrated model in which an econometric-input-output model was linked with a linear programming optimization model for resource allocation. Over the period 1999-2012, the impact on the six agricultural sectors was to reduce their output and employment by 15% annually. The reduction in employment in the rest of the economy was a little over 1% annually. However, since the agricultural sectors continue to employ a significant percentage of the labor force, the aggregate loss of employment amounted to 6% of the total regional employment on average, translating into 1 million jobs annually. When water allocation and energy resource allocations are considered simultaneously, the re-allocations are more limited, resulting in a loss of 0.78 million jobs annually. These results suggest the need for an active link between policy making and economic development when resource constraints are present. Some balance has to be provided between allocation and reallocation on the one hand perhaps driven by concerns with economic efficiency against anticipated losses of employment for part of the labor force with few other alternatives.

Suggested Citation

  • Geoffrey Hewings & Chokri Dridi & Joaquim Guilhoto, 2005. "Impacts of Reallocation of Resource Constraints on the Northeast Economy of Brazil," ERSA conference papers ersa05p14, European Regional Science Association.
  • Handle: RePEc:wiw:wiwrsa:ersa05p14
    as

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    File URL: http://www-sre.wu.ac.at/ersa/ersaconfs/ersa05/papers/14.pdf
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    References listed on IDEAS

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    1. Stein W. Wallace & Stein-Erik Fleten, 2002. "Stochastic programming in energy," GE, Growth, Math methods 0201001, EconWPA, revised 13 Nov 2003.
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    Citations

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    Cited by:

    1. Llop Llop, Maria & Ponce Alifonso, Xavier, 2011. "A never-ending debate: Demand versus supply water policies. A CGE analysis for Catalonia," Working Papers 2072/152139, Universitat Rovira i Virgili, Department of Economics.
    2. Llop, Maria, 2013. "Water reallocation in the input–output model," Ecological Economics, Elsevier, vol. 86(C), pages 21-27.
    3. Llop Llop, Maria & Ponce Alifonso, Xavier,, 2012. "Agriculture, technological change and environmental sustainability: Looking for a win-win water policy strategy," Working Papers 2072/203158, Universitat Rovira i Virgili, Department of Economics.
    4. Pouchkarev, Igor & Spronk, Jaap & Trinidad Segovia, Juan E., 2006. "Empirical Insights on the Heterogeneity of the Spanish Stock Market/Un Análisis Empírico De La Heterogeneidad Del Mercado De Capitales Español," Estudios de Economía Aplicada, Estudios de Economía Aplicada, vol. 24, pages 1091-1106, Diciembre.
    5. Esther Velázquez & M. Alejandro Cardenete & Geoffrey J.D. Hewings, "undated". "Water Price and Water Relocation in Andalusia. A Computable General Equilibrium Approach," Regional and Urban Modeling 283600101, EcoMod.
    6. Cardenete, Manuel Alejandro & Hewings, Geoffrey, 2011. "Water Price and Water Sectoral Reallocation in Andalusia. A Computable General Equilibrium Approach1," 2011 Conference: Impacts of Climate Change on Agriculture, December 6-7, 2011, Rabat, Morocco 188124, Moroccan Association of Agricultural Economics (AMAEco).

    More about this item

    JEL classification:

    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods
    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water

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