Abstract
Abstract. In this study a novel data-driven analytical framework is proposed for cooperative strategies that ensure the optimal allocation of blue and virtual water transfers under different hydrological and economic conditions. A Stackelberg–Nash–Harsanyi equilibrium model is also developed to deal with the hierarchical conflicts between the water affairs bureau and multiple water usage sectors and overcome problems associated with water scarcity and uneven distribution. It was found that cooperative blue and virtual water transfer strategies could save water and improve utilization efficiency without harming sector benefits or increasing the ecological stress. Data-driven analyses were employed to simulate the hydrological and economic parameters, such as available water, crop import price and water market price under various policies. By adjusting the hydrological and economic parameters, it was found that the optimal allocation and transfer strategies were more sensitive to hydrological factors than economic factors. It was also found that cooperative blue/virtual water transfers respond to market fluctuations. Overall, the proposed framework provides sustainable management for physical and virtual water supply systems under future hydrological and economic uncertainties.
Highlights
IntroductionSeveral Chinese provinces, mostly in northern China, suffer from severe water scarcity for almost 7 months each year (Zhuo et al, 2016; Cai, 2008), with the relatively high crop provisioning in southern China further aggravating the problems in northern China (e.g. Xinjiang, Heilongjiang, Guangxi, Hunan, Hebei, and Inner Mongolia) (Wang et al, 2014)
Extreme climatic and hydrological conditions have increased water-scarcity pressure
A novel model based on Stackelberg–Nash– Harsanyi game theory was proposed to analyse a water reallocation problem that included water transfers and crop transactions
Summary
Several Chinese provinces, mostly in northern China, suffer from severe water scarcity for almost 7 months each year (Zhuo et al, 2016; Cai, 2008), with the relatively high crop provisioning in southern China further aggravating the problems in northern China (e.g. Xinjiang, Heilongjiang, Guangxi, Hunan, Hebei, and Inner Mongolia) (Wang et al, 2014). This pattern has led to a paradox whereby water-intensive crops are being exported from water-insufficient northern China to water-rich southern China, and to enable this crop production, water resources are being transferred from water-rich southern China to water-scarce northern China. Game theory, which originated with the pioneering work of Neuman and Morgenstern (1944), was a successful alternative tool used for analysing strategic interactions
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