Marketization and water resource utilization efficiency in China

Abstract

The paper used the Epsilon-Based Measure (EBM) models, the data envelopment analysis (DEA) models, to measure the water resource utilization efficiency based on provincial panel data from 2008 to 2013 in China. The results show that overall of water resource utilization efficiency has a clear rising trend. Moreover, the results show distinct differences in the water resource utilization efficiency from different provinces in China. The water resource utilization efficiency from the eastern regions is higher than that in other regions. Then this paper used the Ordinary Least Square (OLS) models, the econometric models, to estimate the effect of marketization on the water resource utilization efficiency in China. The regression results show that the marketization has a positive effect on the water resource utilization efficiency in China. Lastly, this paper used the Spatial Error Model (SEM), the spatial econometric models, to estimate the spatial spillover effect of marketization on the water resource utilization efficiency in China. The regression results show that the marketization has a positive spatial spillover effect on the water resource utilization efficiency in China. The economic adjacency matrix was selected to be the spatial weight matrix. In particular, this paper used Quadratic Assignment Procedure (QAP), the complex network models, to analyze the rationality of spatial weight matrix selection. The results show that selecting the spatial weighting matrix based on economy-spatial distance is reasonable. Therefore, the research finding is that marketization can improve the water resource utilization efficiency.