Assessing the Water Parallel Pricing System against Drought in China: A Study Based on a CGE Model with Multi-Provincial Irrigation Water

The reform of water management in China is still in progress, and the pricing of water resources is undertaken in parallel, with a divide between irrigation water and pipe water associated with different users: The supply of irrigation water is regulated by local government and that of pipe water is...

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Main Authors: Shuai Zhong, Lei Shen, Jinghua Sha, Mitsuru Okiyama, Suminori Tokunaga, Litao Liu, Jingjing Yan
Format: Article
Language:English
Published: MDPI AG 2015-06-01
Series:Water
Subjects:
Online Access:http://www.mdpi.com/2073-4441/7/7/3431
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spelling doaj-e38b4df30dab4cc4bb11e248a5881a202020-11-25T01:57:41ZengMDPI AGWater2073-44412015-06-01773431346510.3390/w7073431w7073431Assessing the Water Parallel Pricing System against Drought in China: A Study Based on a CGE Model with Multi-Provincial Irrigation WaterShuai Zhong0Lei Shen1Jinghua Sha2Mitsuru Okiyama3Suminori Tokunaga4Litao Liu5Jingjing Yan6School of Humanities & Economic Management, China University of Geosciences, Beijing 100083, ChinaInstitute of Geographic Sciences and Natural Resources Research, Chinese Academy of Sciences, Beijing 100101, ChinaSchool of Humanities & Economic Management, China University of Geosciences, Beijing 100083, ChinaReitaku Institute of Political Economics and Social Studies, Reitaku University, 2-1-1, Hikarigaoka, Kashiwa, Chiba-ken 277-8686, JapanFaculty of Economics and Business Administration, Reitaku University, 2-1-1, Hikarigaoka, Kashiwa, Chiba-ken 277-8686, JapanInstitute of Geographic Sciences and Natural Resources Research, Chinese Academy of Sciences, Beijing 100101, ChinaSchool of Humanities & Economic Management, China University of Geosciences, Beijing 100083, ChinaThe reform of water management in China is still in progress, and the pricing of water resources is undertaken in parallel, with a divide between irrigation water and pipe water associated with different users: The supply of irrigation water is regulated by local government and that of pipe water is operated by the production sector of pipe water. Based on a literature review and an interview survey of farmers, this study incorporated the water parallel pricing system of China within a computable general equilibrium (CGE) model, where the drought of 2000 is simulated. The 16 provincial irrigation water supplies and their subsidies were also estimated and introduced into this CGE model. The results demonstrated that the effects on the macro-economy were insignificant. However, the effects on agricultural production, particularly on farming production mainly cultivated in northern areas, were significant. Most farming production sectors employed more capital and labor to prevent losses in output from drought. Agricultural labor was shifted from non-farming agricultural production sectors into farming. Both urban and rural households suffered severe losses in welfare and food consumption, even though they benefited from the additional income. Moreover, rural households suffering the worst losses were located in both northern and southern areas.http://www.mdpi.com/2073-4441/7/7/3431water parallel pricing systemmulti-provincial irrigation waterCGE modeldroughtChina
collection DOAJ
language English
format Article
sources DOAJ
author Shuai Zhong
Lei Shen
Jinghua Sha
Mitsuru Okiyama
Suminori Tokunaga
Litao Liu
Jingjing Yan
spellingShingle Shuai Zhong
Lei Shen
Jinghua Sha
Mitsuru Okiyama
Suminori Tokunaga
Litao Liu
Jingjing Yan
Assessing the Water Parallel Pricing System against Drought in China: A Study Based on a CGE Model with Multi-Provincial Irrigation Water
Water
water parallel pricing system
multi-provincial irrigation water
CGE model
drought
China
author_facet Shuai Zhong
Lei Shen
Jinghua Sha
Mitsuru Okiyama
Suminori Tokunaga
Litao Liu
Jingjing Yan
author_sort Shuai Zhong
title Assessing the Water Parallel Pricing System against Drought in China: A Study Based on a CGE Model with Multi-Provincial Irrigation Water
title_short Assessing the Water Parallel Pricing System against Drought in China: A Study Based on a CGE Model with Multi-Provincial Irrigation Water
title_full Assessing the Water Parallel Pricing System against Drought in China: A Study Based on a CGE Model with Multi-Provincial Irrigation Water
title_fullStr Assessing the Water Parallel Pricing System against Drought in China: A Study Based on a CGE Model with Multi-Provincial Irrigation Water
title_full_unstemmed Assessing the Water Parallel Pricing System against Drought in China: A Study Based on a CGE Model with Multi-Provincial Irrigation Water
title_sort assessing the water parallel pricing system against drought in china: a study based on a cge model with multi-provincial irrigation water
publisher MDPI AG
series Water
issn 2073-4441
publishDate 2015-06-01
description The reform of water management in China is still in progress, and the pricing of water resources is undertaken in parallel, with a divide between irrigation water and pipe water associated with different users: The supply of irrigation water is regulated by local government and that of pipe water is operated by the production sector of pipe water. Based on a literature review and an interview survey of farmers, this study incorporated the water parallel pricing system of China within a computable general equilibrium (CGE) model, where the drought of 2000 is simulated. The 16 provincial irrigation water supplies and their subsidies were also estimated and introduced into this CGE model. The results demonstrated that the effects on the macro-economy were insignificant. However, the effects on agricultural production, particularly on farming production mainly cultivated in northern areas, were significant. Most farming production sectors employed more capital and labor to prevent losses in output from drought. Agricultural labor was shifted from non-farming agricultural production sectors into farming. Both urban and rural households suffered severe losses in welfare and food consumption, even though they benefited from the additional income. Moreover, rural households suffering the worst losses were located in both northern and southern areas.
topic water parallel pricing system
multi-provincial irrigation water
CGE model
drought
China
url http://www.mdpi.com/2073-4441/7/7/3431
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