Project Research Theme 1: Firms, Frictions and Spillovers, and Industrial Policy, Cross-Cutting Issue 2: Climate Change and the Environment

Clean Water

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  • Larger Research Grants

Clean water is a vital component of economic growth and household welfare, especially in developing nations. This study aims to investigate the economic implications of limited access to clean water and the impact of water infrastructure on household welfare. To fill this aim, this study develops a unified spatial framework that models the supply and demand of water, taking into account the interaction between spatial economic activities and water supply.
The study assesses the impact of restricted clean water access in developing countries using global water resource data. Leveraging high-resolution observations from NASA's gravity field and topography measurements, it examines water availability across different locations and its use in different economic activities. This procedure captures environmental factors and various water flows, overcoming the challenge of integrating comprehensive water flows and states on a global scale, which interact with economic activities. The economic analysis considers both changes in household income and associated water use in consumption and production, as well as water availability; a rival resource shared by many nearby regions. Addressing the difficulties of over-simplistic demand and production characteristics, this study offers a more robust understanding of the complex relationship between water access and economic development.
Combining Earth data and a new economic framework for water resource use, this study deepens our understanding of clean water access in developing nations. By employing a unified approach with a detailed model and harmonized data, the research aids policymakers in making informed decisions regarding water infrastructure investments, ultimately fostering welfare and economic growth in low-income countries. The project team aims to focus on regions of Africa, such as the Sahel region, and has been in communication with the United Nations Economic Commission for Africa (ECA). It is planning a 2024 workshop with the ECA and the African Development Bank to share preliminary findings and highlight the significance of clean water access in Africa.

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