ABSTRACT
This chapter describes the computation of account balances within the water system and the determination of the economic value of water in different situations, which are the works of the first part of the Macro-Economic Integrated Analysis of Hydrology Decision Support System (MEIAH DSS). It explains the steps to integrate information from that water model into the model of the macroeconomy, which is the second major component of MEIAH. The chapter illustrates how apply the full DSS to assess the economic consequences and the policy implications of water decisions. It discusses the algorithms used to make the model reflect the real-world uncertainties of annual rainfall and water availability. The water budget is an attempt to capture the effect of human economic water uses on the water balance. The chapter encompasses both the different steps of the water cycle and the economic production chains requiring water as an input.
