chapter  8
Microeconomics and Basic Economic Relationships
Pages 34

Water is an essential input for human life, agriculture, and several manufacturing industries. In other words, life and production of such things as food and beverages, petroleum, lumber and wood products, paper, chemicals, and electronic equipment (Hanemann, 2005, p. 20) would not be possible without water in certain quantities, qualities, and times. Water is thus defi ned as an “essential” economic commodity. Therein lies the motivation to supply water to ensure production that meets the necessary requirements of life.