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Understanding the economic consequences of changes in water availability and water policy in Scotland: a computable general equilibrium analysis

   Hydro Nation Scholars Programme 2022

  , , Prof Cecilia Tortajada  Friday, January 07, 2022  Competition Funded PhD Project (Students Worldwide)

Glasgow United Kingdom Data Analysis Economic Geography Human Geography Macroeconomics Microeconomics Economics Environmental Sciences Geography

About the Project

The focus of this project is to analyse the economic consequences of changes in water availability in water abundant regions, with a focus on Scotland. Projections show how climate change will affect the location, magnitude, and frequency of Scotland’s rainfall, which will have profound consequences for available water resources. As a water-abundant nation, Scotland is well placed to take advantage of opportunities from good water management, such as increased water efficiency. However, there is only limited understanding of the way in which regions that have typically relied on frequent rainfall can be impacted by unexpected changes in patterns and availability of this resource. The consequences for the Scottish economy of changes in water availability or water management is not currently well understood, nor are the sectors of the economy which could be exposed to such external or policy-driven changes. However, the data demonstrate how industries that are notionally water-intensive, play a crucial role in the Scottish economy. For instance, according to the most recent Scottish National Accounts approximately 6.5% of total export is constituted of agriculture, farming, fishing, and food products, including the production of spirits, beer and soft drink which, in itself, accounts for 4.3% of total export. In addition, these industries are highly interconnected with other sectors in the Scottish economy, such as food and beverages services, and with industries in the rest of the UK, which implies that changes in production in one of these sectors will have a ripple effect in various other parts of the Scottish and UK economies.

This project will develop an economic modelling framework for Scotland – building on expertise developed in such models for economic and environmental analysis – to include water use for the first time. The modelling framework will allow us to capture the impacts of climate-change-induced changes in water availability on economic industries, directly, via reduced productivity and agricultural yields, and indirectly via supply chains and price changes, and on environmental indicators such as emissions of greenhouse gases. The framework will extend the Fraser of Allander Institute’s Computable General Equilibrium (CGE) model (AMOS) which has been widely used for policy analysis, including by the Office of Chief Economic Adviser of the Scottish Government and by the Department for the Economy of Northern Ireland, but never previously for water.

This modelling framework will be used to examine the system-wide consequences of changes in water efficiency in consumption on economic activity and water use, while also assessing the efficacy of policies aimed at mitigating the adverse impacts of potential reduction or change in patterns of water availability.

The work will focus on Scotland as a whole but will recognise the spatial dimension to water resources by disaggregating economic activity and water consumption by water region. This is extremely novel, as the disaggregation of economic activity to regions remains a challenging area, with ongoing work in the Fraser of Allander Institute to map economic activity to city regions. Mapping to hydrological catchments presents a real opportunity to identify how regions reliant upon local resources can adapt to changes within these catchments in terms of water availability, and the impacts on particular sectors. The lessons learned from the project will be relevant to any region and the project will make links through the supervisors to ongoing work in other regions and nations.

The ideal candidate will have a strong background (undergraduate degree and masters) in either environmental science or economics, and a keen interest in the themes of water resources and environmental change. An understanding of environmental/economic modelling would be advantageous, though full training will be provided by the supervisory team. A proficiency in working with data and a knowledge of programming languages (e.g., R, Python or Matlab) is desirable. The successful candidate will also be provided with formal training and networking opportunities to support their project and personal development through the Hydro Nation Scholarship Programme.

Applicants are strongly advised to make an informal enquiry about the PhD to the primary supervisor well before the final submission deadline. Applicants must send a completed Hydro Nation Scholarship application form (available here https://www.hydronationscholars.scot/apply) with a Curriculum Vitae and covering letter to Dr Scott McGrane ( ) by the final submission deadline of 7th January 2022.

Funding Notes

The Hydro Nation Scholars Programme is an open competition for PhD Scholars to undertake approved projects, hosted within Scottish Universities and Research Institutes. This project will be hosted by the University of Strathclyde. Full funding is available from the Scottish Government (to host institutions via the Scottish Funding Council). The funding available will be in line with the UKRI doctoral stipend levels and indicative fees. Applicants should have a first-class honours degree in a relevant subject or a 2.1 honours degree plus Masters (or equivalent). Shortlisted candidates will be interviewed on 27th or 28th January 2022

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