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Sustainable water resource and endogenous economic growth

Ning Zhang (), Tao Wu, Bing Wang, Liang Dong and Jingzhen Ren

MPRA Paper from University Library of Munich, Germany

Abstract: Poyang Lake suffers from a severe shortage of water, due to the construction of the Three Gorges Dam and other hydropower stations along the upper Yangtze River. In this paper, we propose a two-sector endogenous growth model to investigate the effects of extractive water use and impoundment activities on the optimal sustainable growth path. To offset the negative impact of the extractive use on the regenerative capacities of water resources, the impoundment activities should grow at a constant rate. We also provide a numerical example to illustrate the mechanisms of the endowment and the regenerative capacities of water resources on the long-run economic growth path. We find out some theoretical evidence to support the construction of a water conservancy project to restore regeneration capacities of Poyang Lake.

Keywords: Endogenous economic growth; Renewable water resources; Poyang Lake; Extractive use; Impoundment activities; Water sustainability (search for similar items in EconPapers)
JEL-codes: O13 O4 (search for similar items in EconPapers)
Date: 2015-12-27
New Economics Papers: this item is included in nep-env and nep-gro
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Journal Article: Sustainable water resource and endogenous economic growth (2016) Downloads
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