Integrated basin management: Water and food policy options for Turkey

This paper presents a basin scale analysis of the Nilüfer River Basin of Turkey, where agricultural, urban, and environmental users compete for scarce water in an environment where climate change and food security present large and growing challenges. It presents results of a basin scale dynamic nonlinear programming model that addresses economic efficiency, climate change, and food security. Its approach can be applied to other water-stressed regions operating in environments of economic and hydrologic constraints on water use. Basin scale modeling approach provides a general framework for formulating water management policies, consistent with the principles underlying the European Union Water Framework Directive.     

Integrated ecological-economic modelling of water pollution abatement management options in the Upper Ems River Basin

This paper presents the results of the FLUMAGIS project, in which we developed a spatial decision support system (SDSS) to support the implementation of the European Water Framework Directive (WFD). The modelling approach is based on the integration of ecological and socio-economic assessment methods, scale-specific and GIS-based data and knowledge modelling and visualization techniques. The project study area is the intensively cropped Upper Ems River Basin in north-western Germany. A method was developed that enables the transfer of scale-specific data and information. Analyses were performed for baseline conditions and specific management and planning scenarios to improve water quantity and quality at micro-, meso- and macro-scale. The results of the study indicate that substantial, expensive water and land management changes at different scales would be necessary to achieve the WFD water quality targets in this basin. Ecological-economic analysis of cost-effectiveness reveals that the costs of achieving certain goals of the WFD can vary more than tenfold depending on which measure is chosen out of the pool of management alternatives. Moreover, the study shows that the differentiation between landscapes and other regional characteristics although considered essential to the successful implementation of WFD measures is very data intensive.     

Comparative evaluation of the cost of water in northern Malawi: from rural water wells to science education

Worldwide, improved sources of drinking water are still lacking for 663 million people. With Malawi as a case study, we aim to address the scarcity of data available to understand the full cost and options of drinking water at a regional level covering both urban and rural areas. We studied options in the northern region of Malawi under the following thematic areas: urban piped water, water wells, handpump spare part supply networks, household point-of-use water treatment, the cost of entering a water business and capacity building in science education. Primary locally sourced data were collected as well as secondary publically available data. Additionally, local markets were surveyed for spare part networks. This research has shown that when looking at water resource economics in northern Malawi, it is not a monopoly and options are available at a range of costs. The data challenge policy-makers to reach the last 10% of the population still lacking improved drinking water. This will require a combination of expansion of urban piped water infrastructure, new boreholes in rural areas, increased handpump functionality rates, scale-up of household drinking water point-of-use treatment and growth of local universities to train local experts within the sector.     

Watershed externalities, shifting cropping patterns and groundwater depletion in Indian semi-arid villages: The effect of alternative water pricing policies

Frequent droughts and groundwater depletion are critical constraints to improving agricultural productivity in the semi-arid tropics. India has been promoting integrated watershed management in drought-prone areas to address these constraints. Watershed communities are being assisted to invest in groundwater re-charging facilities. While communities and the public bear such costs, individual farmers capture irrigation benefits. Groundwater is a free common property resource and land users hold de-facto use rights. This has accelerated private irrigation investments and depletion of aquifers resulting in iniquitous distribution of irrigation water. Power subsidies and negligible pumping costs aggravate the problem. These policy failures and low irrigation costs to farmers are displacing water-efficient crops in favor of water-intensive crops in water-scare areas. The paper reviews the village-level externalities that aggravate groundwater depletion and evaluates potential policy options to enhance local collective action in water management. Using 3SLS, an econometric crop-water productivity model is used to evaluate alternative water policy instruments. The results indicate that different types of water user charges can be introduced with modest consequences on profitability and farm incomes. If properly implemented and managed by the local communities, pro-poor policies could bring considerable sustainability benefits and also ensure enhanced equity in access to the resource.     

Substitution between water and other agricultural inputs: Implications for water conservation in a River Basin context

Substitution of irrigation water with other agricultural inputs could be an important means to conserve water in the face of growing pressures on water resources from both nonagricultural water demands and environmental water requirements. This paper discusses the potential of such substitution through an empirical analysis based on a multiple-input crop production function at the field and farm scales complemented with a numerical modeling exercise at the basin scale. Results from the crop production function analysis show that under both crop yield and net profit maximization, water is a substitute to other crop inputs for high-value crops, and is a complement to water for low-valued crops. At the basin scale, an integrated economic-hydrologic river basin model is used to analyze the role of other factors in crop input substitution, including the spatial connections among water sources and demands, hydro-agronomic conditions, and institutional settings for water allocation. Results show that in the case study area, the Maipo River basin in Chile, where water is very scarce, moving from the current, input-constrained, situation to full optimization of water resources leads to an increase in all crop inputs, including water. In that case, 301 million m³ of additional water use results in additional net profits of USD 11 million. However, if the water fee is raised by a factor of eight while overall basin irrigation profits are maintained at the original, baseline level, a reduction of water withdrawals by 326 million m³ is traded off with costs of USD 43.2 million for other inputs. Irrigation districts with a high share of low-value crops have a low potential for substituting water with other crop inputs. Therefore, investments for water substitution should also be kept low in these areas.     

The impact of smart meters on residential water consumption: Evidence from a natural experiment in the Canary Islands

Smart meters can promote behavioral changes and water conservation by improving information and providing feedback about water consumption to households. In this paper, we evaluate a large-scale programme implemented by the municipal water company of La Laguna (Tenerife). Exploiting quasi-experimental variation brought about program, we estimate the effect of water meter replacement on measured water consumption and the behavioral effect of the installation of the smart metering technology allowing households to access daily water consumption and real-time feedback through an online portal. Our main empirical analysis employs a difference in differences identification strategy and uses annual consumption data from 51,674 households observed over 10 years. We find a positive effect of water meter replacement on measured water consumption. Our main finding is that providing access to the smart metering technology induces households to reduce consumption by around 2% on average. Our results point to consumers’ engagement with the information portal as the main mechanism behind the observed behavioral response.     

The working for water programme: Evolution of a payments for ecosystem services mechanism that addresses both poverty and ecosystem service delivery in South Africa

A payments for ecosystem services (PES) system came about in South Africa with the establishment of the government-funded Working for Water (WfW) programme that clears mountain catchments and riparian zones of invasive alien plants to restore natural fire regimes, the productive potential of land, biodiversity, and hydrological functioning. The success of the programme is largely attributed to it being mainly funded as a poverty-relief initiative, although water users also contribute through their water fees. Nevertheless, as the hydrological benefits have become apparent, water utilities and municipalities have begun to contract WfW to restore catchments that affect their water supplies. This emerging PES system differs from others in that the service providers are previously unemployed individuals that tender for contracts to restore public or private lands, rather than the landowners themselves. The model has since expanded into other types of ecosystem restoration and these have the potential to merge into a general programme of ecosystem service provision within a broader public works programme. There is a strong case for concentrating on the most valuable services provided by ecosystems, such as water supply, carbon sequestration, and fire protection, and using these as ‘umbrella services’ to achieve a range of conservation goals. The future prospects for expansion of PES for hydrological services are further strengthened by the legal requirement that Catchment Management Agencies be established. These authorities will have an incentive to purchase hydrological services through organisations such as WfW so as to be able to supply more water to their users.     

Heterogeneous treatment effects and mechanisms in information-based environmental policies: Evidence from a large-scale field experiment

Policymakers often rely on non-pecuniary, information-based programs to achieve social objectives. Using data from a water conservation information campaign implemented as a randomized controlled trial, we estimate heterogeneous household responses. Understanding such heterogeneity is important for improving the cost-effectiveness of non-pecuniary programs, extending them to other populations and probing the mechanisms through which the treatment effects arise. We find little evidence of heterogeneous responses to purely technical information or to traditional conservation messages that combine technical information and moral suasion. In contrast, norm-based messages that combine technical information, moral suasion and social comparisons exhibit strong heterogeneity: households that are wealthier, owner-occupied and use more water are more responsive. These subgroups tend to be least responsive to pecuniary incentives. We find no evidence that any subgroup increases their water use in response to the messages. By targeting the messages to subgroups known to be most responsive, program costs could be reduced by over 50% with only a 20% reduction in the treatment effect. Combining theory and data, we also shed light on the mechanisms through which the treatment effects arise, which has implications for program design and future research on the program's welfare effects.     

Water Security and Irrigation Investment: Evidence from a Field Experiment in Rural Pakistan

This study examines the relationship between water security features and irrigation investment using data from a field survey with a choice experiment conducted in rural Pakistan. Our results generally support Besley’s framework on the link between property right and investment incentive with an application to irrigation, although not all aspects of water security features can significantly affect farmers’ investment in irrigation. Investment increases significantly with groundwater share, but there is insufficient evidence to support that farmers’ investment is significantly and positively affected by surface water reliability. Farmers who own land or who are located further down the watercourse tend to invest more than their peers do. Existing conditions on surface water reliability significantly affect this relationship. Overall, groundwater use dominates the decision-making of investment and the role of surface water source in securing irrigation water is relatively weak from a farmer’s perspective.     

Community participation in the management of wetland nature reserve：a case study of Nanjishan Nature Reserve, Jiangxi, China

In recent years, more and more conflicts have emerged in the management of nature reserves, of which themain problem is that how to carry out the campaign of conservation along with the promotion of development of localeconomics. To resolve the actual problem in Nanjishan National Wetland Nature Reserve and explore the idiographicmethod of the management of the wetland reserve, some studying methods including face-to-face interviews, informaldiscussion with local leaders and officials, group discussion with local fishers, questionnaire, and job of the conversationstation have been carried out. The results show that the education level of the local people is low; only 5% of the localpeople have an opportunity to the junior college; the main income of the local people is fishing, which accounts for 70%more or less; and the income is coming down year by year because of the unreasonable way of fishing. To cope with theproblems, some reformative way of management and the development of the reserve are introduced, such as establishingan NOG that constitutes of local fishermen to achieve the goal of community co-management, developing Bed andBreakfast and so on. Through practice of the management of the participation of the local people, we draw the conclusionthat the local people have a great desire to improve their life level, and to make the co-management of the reserve easy,it is important for the managers to play the role of pilot including engrafting the new ideas, giving some subsidy toencourage the local people to take part in the management. In addition, making local people perceive value of the reserveand the close relation between reserve conservation and the promotion of level of their life. On this basis, they incline totake part in the management of the reserve.     

The water footprint of energy from biomass: A quantitative assessment and consequences of an increasing share of bio-energy in energy supply

This paper assesses the water footprint (WF) of different primary energy carriers derived from biomass expressed as the amount of water consumed to produce a unit of energy (m³/GJ). The paper observes large differences among the WFs for specific types of primary bio-energy carriers. The WF depends on crop type, agricultural production system and climate. The WF of average bio-energy carriers grown in the Netherlands is 24 m³/GJ, in the US 58 m³/GJ, in Brazil 61 m³/GJ, and in Zimbabwe 143 m³/GJ. The WF of bio-energy is much larger than the WF of fossil energy. For the fossil energy carriers, the WF increases in the following order: uranium (0.1 m³/GJ), natural gas (0.1 m³/GJ), coal (0.2 m³/GJ), and finally crude oil (1.1 m³/GJ). Renewable energy carriers show large differences in their WF. The WF for wind energy is negligible, for solar thermal energy 0.3 m³/GJ, but for hydropower 22 m³/GJ. Based on the average per capita energy use in western societies (100 GJ/capita/year), a mix from coal, crude oil, natural gas and uranium requires about 35 m³/capita/year. If the same amount of energy is generated through the growth of biomass in a high productive agricultural system, as applied in the Netherlands, the WF is 2420 m³. The WF of biomass is 70 to 400 times larger than the WF of the other primary energy carriers (excluding hydropower). The trend towards larger energy use in combination with an increasing contribution of energy from biomass will enlarge the need for fresh water. This causes competition with other claims, such as water for food.     

Economies of density, scale and scope in the water supply and sewerage sector: a study of four developing and transition economies

Using panel data, we estimate measures of density, scale and scope economies in four countries that differ substantially in their levels of economic development and in their piped water and sewerage coverage: Brazil, Moldova, Romania and Vietnam. We find evidence of economies of scale in Moldova, Romania and Vietnam. In Brazil, we cannot reject the null hypothesis of constant returns to scale. The results of this study show that the cost structure of water and sewerage utilities varies significantly within and between countries and over time.      

Valuing improvements in urban water security: evidence of heterogeneity derived from a latent class model for eastern Australia

In many Australian cities the response to drought has included the imposition of mandatory constraints over how water is used by households, often termed ‘water restrictions’. A similar rationing approach has been witnessed in California’s recent drought. The aim of water restrictions is to slow the depletion of water storage but restrictions have also been criticized for the costs they impose on specific water users. In order to gain insight into the potential magnitude of the cost of water restrictions, this study uses a choice experiment to investigate the non-market values for specific attributes associated with the outcomes of drought restrictions. This information was sought to understand the community’s willingness to pay for attributes related to the extent, frequency and duration of water restrictions. The article reports a latent class choice model for a major city in eastern Australia and investigates heterogeneity in preferences towards increasing water availability during drought. This study departs from the existing literature by conducting the choice experiment in a context where water supply is relatively abundant. This unique framing of the choice experiment allows for a useful comparison with existing studies and also raises challenges about the interpretation of the data for planning purposes.     

Managing portfolio risk in strategic technology management: evidence from a panel data-set of the world's largest R&D performers

In this article, we analyze the impact of firms’ technology bases on their financial performance. By taking a strategic perspective of technology, we argue that it is not sufficient to analyze only the size or novelty/quality of the technology base as technology bases can best be understood as portfolios of individual technologies. In such a framework, risk consideration should be taken into account. More specifically, we argue that increasing technological breadth can serve as a hedge against the inherent uncertainties of developing and commercializing technology, in particular when the technology base is very large or novel. We also propose that technology has higher impacts on financial performance for firms with broader technology portfolios. A similar argument proposes that technological breadth can offset the increased risks of addressing foreign markets. We test our hypotheses using an international panel data-set of large R&D-performing firms. Our results suggest that broad technology portfolios can indeed serve as a hedge against technological and commercialization risks.     

Cost-effectiveness of percutaneous closure of a patent foramen ovale compared with medical management in patients with a cryptogenic stroke: from the US payer perspective

Abstract

Aims: To evaluate the cost-effectiveness of percutaneous patent foramen ovale (PFO) closure, from a US payer perspective. Lower rates of recurrent ischemic stroke have been documented following percutaneous PFO closure in properly selected patients. Stroke in patients aged <60?years is particularly interesting because this population is typically at peak economic productivity and vulnerable to prolonged disability.

Materials and methods: A Markov model comprising six health states (Stable after index stroke, Transient ischemic attack, Post-Transient Ischemic Attack, Clinical ischemic stroke, Post-clinical ischemic stroke, and Death) was constructed to evaluate the cost-effectiveness of PFO closure in combination with medical management versus medical management alone. The base-case model employed a 5-year time-horizon, with transition probabilities, clinical inputs, costs, and utility values ascertained from published and national costing sources. Incremental cost-effectiveness ratio (ICER) was evaluated per US guidelines, utilizing a discount rate of 3.0%.

Results: At 5?years, overall costs and quality-adjusted life-years (QALYs) obtained from PFO closure compared with medical management were $16,323 vs $7,670 and 4.18 vs 3.77, respectively. At 5?years, PFO closure achieved an ICER of $21,049, beneficially lower than the conventional threshold of $50,000. PFO closure reached cost-effectiveness at 2.3?years (ICER = $47,145). Applying discount rates of 0% and 6% had a negligible impact on base-case model findings. Furthermore, PFO closure was 95.4% likely to be cost-effective, with a willingness-to-pay (WTP) threshold of $50,000 and a 5-year time horizon.

Limitations: From a cost perspective, our economic model employed a US patient sub-population, so cost data may not extrapolate to other non-US stroke populations.

Conclusion: Percutaneous PFO closure plus medical management represents a cost-effective approach for lowering the risk of recurrent stroke compared with medical management alone.     

Evaluating the cost-effectiveness of percutaneous closure of a patent foramen ovale versus medical management in patients with a cryptogenic stroke: from the UK payer perspective

Aims: Percutaneous closure of a patent foramen ovale (PFO) is known to lower the risk of recurrent stroke in patients with a cryptogenic stroke. However, the economic implications of transcatheter PFO closure are less well known. From a UK payer perspective, a detailed economic appraisal of PFO closure was performed for prevention of recurrent ischemic stroke in patients with a PFO who had experienced a cryptogenic stroke.

Materials and methods: A Markov cohort model was constructed using a 5-year time-horizon with a patient mean age of 45.2 years, reflecting the characteristics reported in the REDUCE trial. Transition probabilities, clinical inputs, costs, and utility values were ascertained from published and national costing sources. Total costs, incremental costs, quality-adjusted life-years (QALYs), and incremental cost-effectiveness ratios were calculated, utilizing a discount rate of 3.5%. A range of univariate and probabilistic sensitivity analyses were also performed.

Results: When applying a willingness-to-pay (WTP) threshold of £20,000/QALY in accordance with NICE guidelines, PFO closure compared with antiplatelet therapy alone showed a beneficial cost/QALY of £18,584, attained at 4 years. Applying discount rates of 0% and 6% had a negligible effect on the base-case model findings. PFO closure demonstrated a 76.9% probability of being cost-effective at a WTP threshold of £20,000/QALY at a 5-year time-horizon.

Limitations: This model focused specifically on UK stroke patients and typically enrolled young (mean age <65 years old) patients. Hence, caution should be taken when comparing data vs non-UK populations, and it remains unclear how older patients might have affected cost-effectiveness findings, as the risk of paradoxical embolism can persist as patients age.

Conclusion: Percutaneous closure of a PFO is cost-effective compared with antiplatelet therapy alone, underlining the economic benefits potentially afforded by this treatment in selected patients.