This paper examines the distribution of climate change impacts across the sixteen Agro-Ecological Zones (AEZs) of Africa. We combine net revenue from livestock and crops and regress total net revenue on a set of climate, soil, and socio-economic variables with and without country fixed effects. Although African crop net revenue is very sensitive to climate change, combined livestock and crop net revenue is more climate resilient. With the hot and dry CCC climate scenario, average damage estimates reach 27% by 2100, but with the mild and wet PCM scenario, African farmers will benefit. The analysis of AEZs implies that the effects of climate change will be quite different across Africa. For example, currently productive areas such as dry/moist savannah are more vulnerable to climate change while currently less productive agricultural zones such as humid forest or sub-humid AEZs become more productive in the future.

The field of water management is continually changing. Water has been subject to external shocks in the form of climate change and globalization. Water management analysis is subject to disciplinary developments and inter-disciplinary interactions. Are these developments well-documented in the literature? Initial observations in the interdisciplinary literature suggest that results are fragmented, implying that a state-of-the-art review is needed. This paper aims to close such a gap by reviewing recent developments in water economics that address increasing perceptions of water scarcity by looking first at changes in the supply and quality of water and then at the impacts of climate change on water supply extremes. Among responses to such challenges, this paper identifies changes to water use patterns by including and co-managing water from different sources, including surface and groundwater, reclaimed wastewater, and desalinated water. Technological advancements are also among the resources that address water challenges. Water challenges are also reflected in the management of internationally shared water. A recent surge in scientific work identified international treaties as a significant contributor to international water management. This paper reviews recently employed economic approaches, such as experimental economics, game theory, institutional economics, and valuation methods. And, finally, it explores modeling approaches, including hydro-economic and computable general equilibrium models, that are being used to deal with water challenges.

Water scarcity is a critical environmental issue worldwide, especially in arid and semiarid regions. In those regions, climate change projections suggest further reductions in freshwater supplies and increases of the recurrence, longevity and intensity of drought events. At present, one important question for policy debate is the identification of water policies that could address the mounting water scarcity problems. Suitable policies should improve economic efficiency, achieve environmental sustainability, and meet equity needs. This paper develops and applies an integrated hydro-economic model that links hydrological, economic and environmental elements to such issues. The model is used to conduct a direct comparison of water markets, water pricing and institutional cooperation, based on their economic, environmental and equity outcomes. The analysis is performed in the Jucar Basin of Spain, which is a good natural experiment for studying water scarcity and climate change policies. Results indicate that both institutional and water market policies are high performing instruments to limit the economic damage costs of droughts, achieving almost the same social benefits. However, the environmental effects of water markets are worrying. Another important finding is that water pricing is a poor policy option not only in terms of private and environmental benefits but also in terms of equity.

Game Theory (GT), both in its non-cooperative (NCGT) and cooperative (CGT) forms, has been pivotal in its contribution to the analysis of important aspects related to water resources. The 1942 seminal work of Ransmeier on The Tennessee Valley Authority is still considered essential; it continues to inspire many applications related to water allocation decisions. Since Ransmeier, GT models were developed and have been applied to various aspects of water management, such as decisions on cost and benefit allocation in multi-objective multi-use water projects, conflicts and joint management of irrigation projects, management of groundwater aquifers, hydropower facilities, urban water supplies, wastewater treatment plants, and transboundary water disputes. World water resources face new challenges that suggest a renewed role for GT in water management. Scarcity, growing populations, and massive development have led to increased competition over water resources and subsequent elevated pollution levels. Climate change is expected to unevenly affect the hydrological cycle, leading to increased variability in water supplies across time and space and uncertainty in water allocation decisions. Future investments in water resource projects will be astronomical, needing much more stable rules for cost allocations among participating entities and over time. Levels of water disputes may vary from local to regional, state, and international levels. All of these suggest that while GT models and applications to water resources have advanced over the years, much more is expected. This monograph will review the main contributions of GT in water resources over the past 70 years. It will compare the set of issues faced by water resources and those which the sector is most likely to face in the coming future. Based on this comparison, a future research agenda and priorities will be proposed. Following the literature’s time line with a focus on various methodologies, sectoral applications (such as irrigation, hydropower, environmental water uses, navigation, etc.), and regional issues, we will also identify physical and behavioral features in the water sector that might be conducive to GT (such as scarcity, externality, uncertainty, and competition-conflict) and some features of intervention (such as the important role for policy, regulation, and incentives), which all affect the likelihood of GT solutions in terms of acceptability and stability.