Virtual Water Trade and Country Vulnerability: A Network Perspective

Abstract

We analyze the link between virtual water trade, that is, the flow of water embodied in the international trade of agricultural goods, and vulnerability to external shocks from the vantage point of network analysis. While a large body of work has shown that virtual water trade can enhance water saving on a global scale, being especially beneficial to arid countries, there are increasing concerns that more openness makes countries more dependent on foreign food suppliers and especially more susceptible to external shocks. Our evidence reveals that the increased globalization witnessed in the last 30 years is not associated with the increased frequency of adverse shocks (in either precipitation or food production). Furthermore, building on recent advances in network analysis that connect the stability of a complex system to the interaction between the distribution of shocks and the network topology, we find that the world is more interconnected, but not necessarily less stable.

Identifying the community structure of the food-trade international multi-network

“…Selecting commodities according to a mass-tokcal conversion-rather than value or volume-allows us to aggregate primary crops together with their processed commodities to understand global food trade from a caloric food-security perspective. Other dimensions of the global food system-such as the economic [41], nutritional [42], or virtual water [32,[43][44][45][46] properties-may have distinct characteristics and may be analyzed in future studies.…”

“…¶ Other factors such as water [34,35,36,27] or nutritional [37] content of the food may be included in future studies. + Note that our selected commodities are still the top-16 most-traded agricultural products in terms of kcal also in 2011.…”