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GTAP Resource #4072

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


Abstract
It is possible that water efficiency in irrigation agriculture may improve substantially over the next decade or two. This means that there may be strong growth in export demand for agricultural and food products in major agricultural nations.
At the same time, worsening agricultural land and water scarcities worldwide may not be matched by agricultural productivity growth. Farmers deal with the vagaries of seasonal conditions and international markets, and climate change is also a threat.
In the Australian context, under Water Act 2007, designed to restore the Murray-Darling Basin, much funding is devoted to infrastructure upgrades. The main task of this study is to evaluate the marginal impact of accelerated water savings which may arise from a number of sources, including infrastructure upgrades, on the economy of the southern Murray-Darling Basin.
An important part of responding to changing market conditions and seasonal variations is in the farm factor flexibility in the southern Murray-Darling Basin. This is accentuated by water trading which is possible between farmers and between regions in the southern basin.
This study uses TERM-H2O, a dynamic CGE model with considerable detail in the southern Murray-Darling Basin of Australia, 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.

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Resource Details (Export Citation) GTAP Keywords
Category: 2013 Conference Paper
Status: Published
By/In: Presented at the 16th Annual Conference on Global Economic Analysis, Shanghai, China
Date: 2013
Version:
Created: Wittwer, G. (4/3/2013)
Updated: Wittwer, G. (4/3/2013)
Visits: 634
- Dynamic modeling
- Climate impacts
- Water
- Oceania


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