Industrial water-use efficiency in China: Regional heterogeneity and incentives identification

Abstract

Progress has been made in improving water-use efficiency (WUE) in China, whereas problems such as unbalanced regional and industrial WUE development still exist. In this study, the WUE of 30 provinces in mainland China at the overall level as well as three industrial (i.e., primary, secondary, and tertiary industrial) levels are investigated. The study covers the time period 2005 to 2015 and is based on the Slacks-based measure approach combined with the Super-efficiency model dealing with undesirable outputs; in addition, a multidimensional analytical framework was developed in this study. Afterwards, the geographical detector model is applied to identify the driving forces of WUE, serving as a reference for policies and strategies needed to improve WUE. Results indicate that China’s overall WUE has been improving since 2005, though further progress is necessary. At the regional level, five regions (i.e., water abundance, vulnerability, stress, scarcity, and absolute scarcity) grouped by the availability of water resources per capita are all the most efficient in terms of water use in the primary industry. The absolute scarcity region performs best in all four dimensions despite the scarcity of water resources per capita, yet the water stress region has the lowest WUE. At the provincial level, provinces in the eastern coastal region, especially the south-eastern coastal region, have the highest WUE, whereas those in the interior south-eastern and south-western region have the lowest. Industrial structure, research and development intensity, and higher education are the main driving forces of WUE. Their mutual interactions and their interactions with other indicators are highly influential.