A Scenario-Based Framework for Assessing the Economic Impacts of Potential Droughts

Decker, Christopher; Hall, Jim W.

doi:10.1142/s2382624x17500072

Cited by 12 publications

(16 citation statements)

References 26 publications

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“…Given the projected increasing risk of economic losses due to surface water abstraction restrictions, farm‐level behavioral, infrastructural, and technological changes are likely to continue to occur within the sector (Freire‐González et al, ). These will include investments to secure water supply (e.g., on‐farm reservoir construction, multiple abstraction sources, rainwater harvesting), changes to more drought‐tolerant or less water‐intensive crop varieties; soil management practices to increase water retention (Rey et al, ), water recycling, and the use of soil moisture monitoring and decision support tools for improved irrigation scheduling (Gadanakis et al, ).…”

Section: Discussionmentioning

confidence: 99%

A Probabilistic Risk Assessment of the National Economic Impacts of Regulatory Drought Management on Irrigated Agriculture

et al. 2019

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Drought frequency and intensity is expected to increase in many regions worldwide, and water shortages could become more extreme, even in humid temperate climates. To protect the environment and secure water supplies, water abstractions for irrigation can be mandatorily reduced by environmental regulators. Such abstraction restrictions can result in economic impacts on irrigated agriculture. This study provides a novel approach for the probabilistic risk assessment of potential future economic losses in irrigated agriculture arising from the interaction of climate change and regulatory drought management, with an application to England and Wales. Hydrometeorological variability is considered within a synthetic data set of daily rainfall and river flows for a baseline period (1977–2004) and for projections for near future (2022–2049) and far future (2072–2099). The probability, magnitude, and timing of abstraction restrictions are derived by applying rainfall and river flow triggers in 129 catchments. The risk of economic losses at the catchment level is then obtained from the occurrences of abstraction restrictions combined with spatially distributed crop‐specific economic losses. Results show that restrictions will become more severe, more frequent, and longer in the future. The highest economic risks are projected where drought‐sensitive crops with a high financial value are concentrated in catchments with increasingly uncertain water supply. This research highlights the significant economic losses associated with mandatory drought restrictions experienced by the agricultural sector and supports the need for environmental regulators and irrigators to collaboratively manage scarce water resources to balance environmental and economic considerations.

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Section: Discussionmentioning

confidence: 99%

A Probabilistic Risk Assessment of the National Economic Impacts of Regulatory Drought Management on Irrigated Agriculture

et al. 2019

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“…In other applications, I‐O studies have assessed the indirect costs from historic drought, often focused on agriculture and energy production, at a regional and national level (e.g., Diersen & Taylor, 2003; Perez y Perez & Barreiro‐Hurle, 2009; Wheaton et al., 2008) as well as for hypothetical and simulated events, including under projections of climate change (Eamen et al., 2020; Freire‐González et al., 2017b; Jenkins, 2013). However, these studies tend to use exogenous estimates of direct drought costs and embed these in the models to calculate indirect losses.…”

Section: Economic I‐o Modeling Of Drought Impactsmentioning

confidence: 99%

An Integrated Framework for Risk‐Based Analysis of Economic Impacts of Drought and Water Scarcity in England and Wales

Jenkins

Dobson

Decker

2021

Water Resources Research

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 Simulated water availability from a national water resource system model are integrated with a macroeconomic model to assess drought risk  The use of a large ensemble of synthetic drought simulations supports the risk-based analysis of direct and indirect economic losses  The method supports national economic assessment of the implications of climate change and different water management strategies

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“…A number of studies have applied input-output (I-O) methods to assess the economic impacts of water scarcity during a drought event [6][7][8][9][10][11][12][13]. More general reviews of empirical research on droughts include [14][15][16][17].…”

Section: Previous Economic Studiesmentioning

confidence: 99%

A Linear Programming Approach to Water Allocation during a Drought

Decker

2018

Water

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The economic impacts of a drought depend critically on how water is allocated to different users. Choices as to water allocation can often reflect wider economic policy, environmental, and social goals and constraints. This research applies a multi-objective linear programming input-output method to determine a suite of water supply allocations for different economic sectors in a drought. Using the UK as a case study, we develop estimates of the minimum potential economic impact associated with different water allocations under a range of climate and policy scenarios. Estimates of total impact range from −0.16% to −1.48% of total output depending on the drought scenarios tested. The approach offers the flexibility to set different policy objectives in terms of water allocations/ restrictions, employment or a range of other objectives, including constraints to rebalance the economic system. In allowing for the inclusion of other economic, social, and environmental constraints, it provides a framework for policymakers to assess how water allocation decisions interact with other policy goals to determine the economic impacts of a drought. Challenging decisions about how to allocate water during a drought are likely to remain important in the future.

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A Scenario-Based Framework for Assessing the Economic Impacts of Potential Droughts

Cited by 12 publications

References 26 publications

A Probabilistic Risk Assessment of the National Economic Impacts of Regulatory Drought Management on Irrigated Agriculture

A Probabilistic Risk Assessment of the National Economic Impacts of Regulatory Drought Management on Irrigated Agriculture

An Integrated Framework for Risk‐Based Analysis of Economic Impacts of Drought and Water Scarcity in England and Wales

A Linear Programming Approach to Water Allocation during a Drought

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