ABSTRACT

In the theoretical part of the study a hydroeconomic model was developed to assess the extent to which groundwater depletion should be permitted from a long-term economic viewpoint. It was argued that groundwater should not be depleted if irreversible damage, such as salinization or land subsidence, would occur. Where there is no danger of such irreversible damage, however, controlled depletion of ground-water can be beneficial, especially if water is very scarce and renewable substitutes are available. Such substitutes include the import of “virtual water” in the form of food, where water is currently used for agricultural purposes (see the chapter “Is Water Substitutable?” in the theoretical part). Only if water availability falls below the threshold of minimum human water use, for which there is no substitute, the likely future cost of importing water by pipeline or tanker must be included in the analysis.