Advertisement

TERM-H2O Modeling of Droughts in Australia and California

  • Glyn WittwerEmail author
Chapter
Part of the Advances in Applied General Equilibrium Modeling book series (AAGEM)

Abstract

In the early years of implementation of Australia’s 2007 Water Act, analysis with TERM-H2O put water policy into perspective. Drought resulted in economic hardship, whereas legislated water buybacks provided farmers with an adjustment option. TERM-H2O predicted with reasonable accuracy the impact of abnormally dry or wet years on irrigation water prices within the Murray-Darling Basin. The theory of TERM-H2O was introduced to a version of USAGE-TERM modified to depict the impact of drought on California. The unsustainable use of ground-water in response to the Californian drought indicates a need for water policy reforms in the state.

Keywords

Drought impacts Water reforms Farm factor mobility Water trading 

References

  1. ABS (Australian Bureau of Statistics) (2008) Water and the Murray Darling Basin: a statistical profile, 2000–01 to 2005–06. Catalogue 4610.0.55.007Google Scholar
  2. ABS (Australian Bureau of Statistics) (2009a) Water use on Australian farms, 2007–08. Catalogue 4618.0Google Scholar
  3. ABS (Australian Bureau of Statistics) (2009b) Value of agricultural commodities produced, 2007–08. Catalogue 7503.0Google Scholar
  4. Adamson D, Loch A (2014) The latest Murray-Darling plan could leave farmers high and dry. https://theconversation.com/the-latest-murray-darling-plan-could-leave-farmers-high-and-dry-27450. Accessed 31 Aug 2016
  5. Australian Government (2007) A national plan for water security. http://nailsma.org.au/sites/default/files/publications/national_plan_water_security2007.pdf. Accessed 10 Sept 2016
  6. Chappelle C, Hanak E, Mount J (2015) Reforming California’s groundwater management. PPIC Water Policy Center. http://www.ppic.org/main/publication_show.asp?i=1106. Accessed 9 Sept 2016
  7. Davidson B (1969) Australia wet or dry? The physical and economic limits to the expansion of irrigation. Melbourne University Press, MelbourneGoogle Scholar
  8. Delaney A (2010) Massive water meeting for Griffith. http://www.abc.net.au/local/stories/2010/10/15/3039023.htm. Accessed 31 Aug 2016
  9. Dixon P, Rimmer M (2010) You can’t have a CGE recession without excess capacity. Econ Model 28:602–613CrossRefGoogle Scholar
  10. Dixon P, Parmenter B, Sutton J, Vincent D (1982) ORANI: a multisectoral model of the Australian economy. Contributions to economic analysis 142, Amsterdam, North-HollandGoogle Scholar
  11. Dixon P, Rimmer M, Wittwer G (2011) Saving the Southern Murray-Darling Basin: the economic effects of a buyback of irrigation water. Econ Rec 87:153–168CrossRefGoogle Scholar
  12. Howitt R, M’Marete M (1991) Well set aside proposal: a scenario for ground water banking. Calif Agric 45(3):6–8Google Scholar
  13. Howitt R, MacEwan D, Medellín-Azuara J, Lund J, Sumner, D (2015) Economic analysis of the 2015 drought. UC Davis Center for Watershed Sciences ERA Economics. https://watershed.ucdavis.edu/files/biblio/Final_Drought%20Report_08182015_Full_Report_WithAppendices.pdf. Accessed 26 Sept 2018
  14. Kagi J (2016) Ord River project plagued by cost blowouts, delays, poor planning, auditor-general finds. http://www.abc.net.au/news/2016-09-07/ord-river-project-plagued-by-cost-blowouts-delays-report/7823422. Accessed 26 Sept 2018
  15. NSW Irrigators’ Council (2010) Submission to productivity commission: market mechanisms for recovering water in the Murray-Darling Basin. http://www.pc.gov.au/inquiries/completed/murray-darling-water-recovery/submissions/sub032.pdf. Accessed 26 Sept 2018
  16. Shields M (2016) Riverina mayors call for water policy rethink after SunRice slashes jobs. http://www.abc.net.au/news/2016-01-29/riverina-mayors-call-for-water-policy-rethink/7123112. Accessed 26 Sept 2018
  17. Stevens M (2016) After years without water, taps are turned on in East Porterville. http://www.latimes.com/local/lanow/la-me-ln-east-porterville-20160819-snap-story.html. Accessed 26 Sept 2018
  18. Wheeler S, Zuo A, Bjornlund H (2014) Investigating the delayed on-farm consequences of selling water entitlements in the Murray-Darling Basin. Agric Water Manage 145:72–82CrossRefGoogle Scholar
  19. Wittwer G (2011) Confusing policy and catastrophe: Buybacks and drought in the Murray–Darling Basin. Ec Papers 30:289–295CrossRefGoogle Scholar
  20. Wittwer G (2015) From almond shaming to water trading: CGE insights into managing California’s drought. Centre of Policy Studies working paper G-258Google Scholar
  21. Wittwer G (ed) (2017) Multi-regional dynamic general equilibrium modeling of the U.S. economy. Springer, DordrechtGoogle Scholar
  22. Wittwer G, Banerjee O (2015) Investing in irrigation development in North West Queensland, Australia. Aust J Agric Res Econ 59(2):189–207CrossRefGoogle Scholar
  23. Wittwer G, Dixon J (2013) Effective use of public funding in the Murray-Darling Basin: a comparison of buybacks and infrastructure upgrades. Aust J Agric Res Econ 57:399–421CrossRefGoogle Scholar
  24. Wittwer G, Griffith M (2011) Modelling drought and recovery in the southern Murray-Darling basin. Aust J Agric Resour Econ 49:342–359CrossRefGoogle Scholar
  25. Wittwer G, Griffith M (2012) The economic consequences of a prolonged drought in the Southern Murray-Darling Basin. In: Wittwer G (ed) Economic modeling of water. Springer, Dordrecht, pp 119–141CrossRefGoogle Scholar

Copyright information

© Springer Nature Singapore Pte Ltd. 2019

Authors and Affiliations

  1. 1.Center of Policy StudiesVictoria UniversityMelbourneAustralia

Personalised recommendations