Market efficiency and welfare effects of inter-sectoral water allocation in South Africa

Show simple item record Juana, J.S. (James Sharka) Strzepek, Kenneth M. Kirsten, Johann F. 2011-08-23T06:30:41Z 2011-08-23T06:30:41Z 2011
dc.description.abstract The need for increased agricultural production to meet the growing demand for food, coupled with concerns for environmental sustainability, economic growth and poverty reduction has increased demand on the already scarce water in South Africa. At the same time, because of agriculture’s minimal contribution, compared to the industrial and mining sectors, to South Africa’s GDP and employment, the call to reallocate water from agriculture to non-agricultural use has been intensified. This study updates the 1998 Social Accounting Matrix (SAM) for South Africa and uses the computable general equilibrium model to analyze the impact of water reallocation from agriculture to the non-agricultural sectors on output growth, value added at factor cost, which captures the payments from the production sectors to the factors of production, and households’ welfare. Using different water reallocation scenarios, the simulation results indicate that water reallocation from agriculture to non-agricultural sectors beyond the level of a market allocation scenario will lead to a decline in sectoral output and a significant deterioration in the welfare of poor households. It thus undermines development efforts aimed at reducing the existing level of poverty in the country. en
dc.description.sponsorship The authors are grateful to the International Food Policy Research Institute (IFPRI), Statistics South Africa (STATSSA), Trade and Industrial Policy Strategy of South Africa (TIPS) and the Department of Water Affairs and Forestry (DWAF), for the use of their different data sources; and to the African Economic Research Consortium (AERC), United States Agency for International Development (USAID) and the University of Colorado, Boulder, for jointly funding the study. en_US
dc.identifier.citation Juna, JS, Strzepek, KM & Kirsten, JF 2011, 'Market efficiency and welfare effects of inter-sectoral water allocation in South Africa', Water Policy, vol.13, no. 2, pp. 220.231. en
dc.identifier.other 10.2166/wp.2010.096
dc.language.iso en en_US
dc.publisher IWA Publishing en_US
dc.rights © 2011 IWA Publishing en_US
dc.subject Computable general equilibrium (CGE) en
dc.subject Households’ welfare en
dc.subject Sectoral output en
dc.subject.lcsh Water demand management -- South Africa en
dc.subject.lcsh Water in agriculture -- South Africa en
dc.subject.lcsh Resource allocation -- South Africa en
dc.subject.lcsh Equilibrium (Economics) en
dc.subject.lcsh Home economics -- South Africa en
dc.subject.lcsh Value added -- South Africa en
dc.subject.lcsh Water-supply, Agricultural -- South Africa en
dc.subject.lcsh Industrial water supply -- South Africa en
dc.title Market efficiency and welfare effects of inter-sectoral water allocation in South Africa en
dc.type Postprint Article en

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