The socio-economic impacts of climate change on water resources in South Africa*

Abstract

Using a computable general equilibrium approach, this study investigates the economy-wide impact of reductions in water resources in South Africa due to climate change. The simulation results show a potentially general deterioration in household welfare. Poor households are the most vulnerable. Short-run policy simulations suggest that this vulnerability can be reduced through welfare policies that maintain food consumption levels for households in the two lowest income quintiles.