WATER SCARCITY FROM CLIMATE CHANGE AND ADAPTATION RESPONSE IN AN INTERNATIONAL RIVER BASIN CONTEXT

Jason F.L. Koopman (), Onno Kuik, Richard Tol and Roy Brouwer ()
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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

Climate Change Economics (CCE), 2015, vol. 06, issue 01, 1-22

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.

Keywords: Applied general equilibrium; water allocation; water scarcity; climate change (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (7)

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DOI: 10.1142/S2010007815500049

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