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Part of the book series: Advances in Applied General Equilibrium Modeling ((AAGEM))


The drought of 2012–2015 in California imposed severe stress on the state’s water resources. USAGE-TERM is a multi-regional CGE model that represents 12 key irrigation counties in California as separate economies. Water trading between irrigators would help California cope with drought. In particular, sales of water from producers of annual crops to producers of perennials may lower the costs of maintaining plantations, given the high fixed costs arising from the alternative of drilling new wells.

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    During a prolonged drought, the early years tend to include a reduction in the rainfall contribution and a lesser reduction in the irrigation water availability. Water managers, based on the Australian experience (see Wittwer and Griffith 2011, Table 7.5), tend to impose more severe cuts in the later years of drought and maintain reduced allocations in the first recovery year.

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    In the regional context, the terms-of-trade refer to the price index for international plus inter-regional exports divided by the corresponding international plus inter-regional imports price index, inclusive of water trading.

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    The Huffington Post provided a light-hearted review of the short-lived “almond shaming” campaign at Accessed 7 August 2015.


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Correspondence to Glyn Wittwer .

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Wittwer, G. (2017). Modeling California’s Drought. In: Wittwer, G. (eds) Multi-regional Dynamic General Equilibrium Modeling of the U.S. Economy. Advances in Applied General Equilibrium Modeling. Springer, Cham.

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