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Water Scarcity From Climate Change And Adaptation Response In An International River Basin Context

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  • JASON F.L. KOOPMAN

    (Department of Environmental Economics, Institute for Environmental Studies, VU University Amsterdam, de Boelelaan 1087, 1081 HV, Amsterdam, The Netherlands)

  • ONNO KUIK

    (Department of Environmental Economics, Institute for Environmental Studies, VU University Amsterdam, de Boelelaan 1087, 1081 HV, Amsterdam, The Netherlands)

  • RICHARD S.J. TOL

    (Department of Environmental Economics, Institute for Environmental Studies, VU University Amsterdam, de Boelelaan 1087, 1081 HV, Amsterdam, The Netherlands;
    Department of Economics, University of Sussex, United Kingdom;
    Department of Spatial Economics, VU University Amsterdam, de Boelelaan 1105, 1081 HV, Amsterdam, The Netherlands)

  • ROY BROUWER

    (Department of Environmental Economics, Institute for Environmental Studies, VU University Amsterdam, de Boelelaan 1087, 1081 HV, Amsterdam, The Netherlands)

Abstract

We simulate and analyze the direct and indirect economic impacts of climate change on water availability for irrigation on the economy of the Netherlands and the other EU countries which share the Rhine and Meuse river basin (France, Germany and Belgium), employing a computable general equilibrium (CGE) model. We make use of the GTAP-W model, distinguishing between rainfed and irrigated land and irrigation water as input factors in agricultural production. We assess the scope of market adaptation to climate change by comparing the CGE results with the direct agricultural damage costs estimated using hydrological and crop growth models. We find considerable scope for market adaptation in that total economic impacts on agriculture are much lower when accounting for substitution effects and cross-sectoral and cross-country interlinkages, while the impact on the nonagricultural sectors becomes larger when these substitution effects and interlinkages are accounted for.

Suggested Citation

  • Jason F.L. Koopman & Onno Kuik & Richard S.J. Tol & Roy Brouwer, 2015. "Water Scarcity From Climate Change And Adaptation Response In An International River Basin Context," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 6(01), pages 1-22.
    • Handle: RePEc:wsi:ccexxx:v:06:y:2015:i:01:n:s2010007815500049
    DOI: 10.1142/S2010007815500049
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    References listed on IDEAS

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    1. Roberto Ponce & Francesco Bosello & Carlo Giupponi, 2012. "Integrating Water Resources into Computable General Equilibrium Models - A Survey," Working Papers 2012.57, Fondazione Eni Enrico Mattei.
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    3. Alvaro Calzadilla & Katrin Rehdanz & Richard Betts & Pete Falloon & Andy Wiltshire & Richard Tol, 2013. "Climate change impacts on global agriculture," Climatic Change, Springer, vol. 120(1), pages 357-374, September.
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    5. Dudu, Hasan & Chumi, Sinqobile, 2008. "Economics of irrigation water management : a literature survey with focus on partial and general equilibrium models," Policy Research Working Paper Series 4556, The World Bank.
    6. Calzadilla, Alvaro & Rehdanz, Katrin & Tol, Richard S.J., 2011. "The GTAP-W model: Accounting for water use in agriculture," Kiel Working Papers 1745, Kiel Institute for the World Economy (IfW Kiel).
    7. Alexandre Gohin & Thomas W. Hertel, 2001. "A note on the CES functional form and its use in the GTAP model," Post-Print hal-01931687, HAL.
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    Citations

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    Cited by:

    1. Jason F. L. Koopman & Onno Kuik & Richard S. J. Tol & Roy Brouwer, 2017. "The potential of water markets to allocate water between industry, agriculture, and public water utilities as an adaptation mechanism to climate change," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 22(2), pages 325-347, February.
    2. Dario Aversa & Nino Adamashvili & Mariantonietta Fiore & Alessia Spada, 2022. "Scoping Review (SR) via Text Data Mining on Water Scarcity and Climate Change," Sustainability, MDPI, vol. 15(1), pages 1-13, December.
    3. Levin-Koopman, Jason & Kuik, Onno & Tol, Richard & Van Der Vat, Marnix & Hunink, Joachim & Brouwer, Roy, 2019. "Distributing water between competing users in the Netherlands," Conference papers 333097, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    4. Muhammad Zeshan, Muhammad Shakeel, Paulo Ferreira, 2024. "Water and Future Markets in Pakistan: A Dynamic CGE-Water Framework," Research on World Agricultural Economy, Nan Yang Academy of Sciences Pte Ltd (NASS), vol. 5(4), September.
    5. Jing Liu & Thomas Hertel & Farzad Taheripour, 2016. "Analyzing Future Water Scarcity in Computable General Equilibrium Models," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 2(04), pages 1-30, December.
    6. Teotónio, Carla & Rodríguez, Miguel & Roebeling, Peter & Fortes, Patrícia, 2020. "Water competition through the ‘water-energy’ nexus: Assessing the economic impacts of climate change in a Mediterranean context," Energy Economics, Elsevier, vol. 85(C).
    7. 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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