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Accelerated water savings and demand growth for farm outputs: impacts on the economy of the southern Murray-Darling Basin

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  • Wittwer, Glyn

Abstract

It is possible that water efficiency in irrigation agriculture may improve substantially over the next decade or two. At the same time, worsening agricultural land and water scarcities worldwide may not be matched by agricultural productivity growth. This means that there may be strong growth in export demand for agricultural and food products in major agricultural nations. This study uses TERM-H2O, a dynamic CGE model with considerable detail in the southern Murray-Darling Basin, to examine the impacts of both fast water efficiency gains and strong export demand growth over time. Water efficiency gains will have relatively small impacts on the economy of the southern basin, but during drought years the gains are larger. The economic benefits on the southern basin of rapid export demand growth will be larger than those of water savings. Water efficiency gains and rapid export demand growth have differing impacts on the composition of crops and livestock production in the southern basin.

Suggested Citation

  • Wittwer, Glyn, 2013. "Accelerated water savings and demand growth for farm outputs: impacts on the economy of the southern Murray-Darling Basin," Conference papers 332426, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
  • Handle: RePEc:ags:pugtwp:332426
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    References listed on IDEAS

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    1. van Heerden, Jan H. & Blignaut, James & Horridge, Mark, 2008. "Integrated water and economic modelling of the impacts of water market instruments on the South African economy," Ecological Economics, Elsevier, vol. 66(1), pages 105-116, May.
    2. Peter B. Dixon & Maureen T. Rimmer & Glyn Wittwer, 2011. "Saving the Southern Murray‐Darling Basin: The Economic Effects of a Buyback of Irrigation Water," The Economic Record, The Economic Society of Australia, vol. 87(276), pages 153-168, March.
    3. Alvaro Calzadilla & Katrin Rehdanz & Richard S.J. Tol, 2011. "Water scarcity and the impact of improved irrigation management: a computable general equilibrium analysis," Agricultural Economics, International Association of Agricultural Economists, vol. 42(3), pages 305-323, May.
    4. Brouwer, Roy & Hofkes, Marjan, 2008. "Integrated hydro-economic modelling: Approaches, key issues and future research directions," Ecological Economics, Elsevier, vol. 66(1), pages 16-22, May.
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    More about this item

    Keywords

    Resource /Energy Economics and Policy; Environmental Economics and Policy;

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water

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