Economic Analysis of China's Water System

Author: Liu Wei
Publisher:
Publish Date: 2005-09-01
Features: Water institution research is an interdisciplinary topic that involves cross-cutting and mutual penetration. This book applies the theory of new institutional economics, from the perspective of international comparison and historical evolution, to examine and analyze the changes and trends in global water institutions, as well as the historical evolution of China's water institutions. By constructing a multi-mechanism coexisting water allocation model, it forms a multi-level framework for analyzing China's water institutions. The book also conducts an in-depth study and analysis of three supporting institutional arrangements: China's water pricing system, water rights and water market system, and water user organization system. It applies the basic framework of China's water institutions in a river basin context to empirical analyses of the Zhangye case in the Heihe River Basin, the Yellow River drying-up phenomenon, and the South-to-North Water Diversion Project. The author argues that China's water shortage is superficially a resource crisis but essentially a institutional shortage, stemming from the long-term failure of water management institutions, which has led to low governance capacity and an inability to effectively respond to various challenges under changing conditions. Therefore, institutional innovation is the fundamental solution to China's water shortage.