Abstract
This study utilizes a Computable General Equilibrium (CGE) model, specifically the GTAP-AW model, to analyse the economic implications of alternative water sectors in mitigating natural water scarcity, with a focus on the Mediterranean region. Acknowledging the escalating water scarcity exacerbated by climate change, the research integrates alternative water sources - desalination and treated wastewater - into the economic framework, establishing a direct link with natural water as a primary factor of production. The study provides a comprehensive assessment of how changes in the availability and management of water resources, both natural and alternative, can impact critical sectors and the overall economy, especially under climate-induced water scarcity. The research hypothesizes that, despite the higher financial and energy costs, the adoption of alternative water sources in water-stressed regions yields substantial social benefits by ensuring food security, sustaining economic growth, and mitigating the impacts of natural water shortages. It emphasizes the need for advanced water treatment, desalination technologies, and effective water management strategies as crucial adaptation mechanisms to climate change. The findings highlight the economic value of alternative water sources and advocate for the inclusion of detailed technical substitution and innovation capabilities in CGE models to accurately evaluate the economy-wide potential for substituting capital and other inputs for water. This study contributes to the literature by providing a nuanced understanding of the role of alternative water sources in climate adaptation and economic resilience, particularly in regions vulnerable to water scarcity.
Presenters
Mordechai ShechterSenior Researcher, Natural Resource and Environmental Research Center, University of Haifa, Israel
Details
Presentation Type
Paper Presentation in a Themed Session
Theme
Economic, Social, and Cultural Context
KEYWORDS
Computable General Equilibrium, Desalination, Treated water, Reused water, Natural water
