Globalization and natural resources: the expansion of the Spanish agrifood trade and its impact on water consumption, 1965–2010

Abstract

Beginning in 1960, the Spanish agricultural sector underwent an intensive process of development, resulting in important structural changes, not only in the sector itself, but also in the relationship of the agrarian system to natural resources. These changes were closely related to the growth of per capita income and Spain’s increasing integration into international markets. In the last five decades, the volume of Spanish agricultural trade has increased strongly, with a concomitant increase in the consumption of domestic water resources, requiring the construction of water infrastructure for irrigation. This paper examines the impact on water use in Spain during a period of economic modernization and trade liberalization. More specifically, we are interested in obtaining virtual water trade flow trends and identifying the major drivers responsible for these trajectories, via a decomposition analysis. Our results point to a large increase in virtual water exports and imports, primarily driven by the scale effect, that is, by the growing integration into international markets. The composition effect and changes in water intensity entailed a moderation in water consumption.