Document Type

Report

Publication Date

January 1983

Abstract

Three approaches to drought management are developed as generalized mathematical models. Each model is then applied to particular locations in Utah using the hydrologic/economic data from the 1976-77 drought. The modeling approaches include: (1) A multiple regression approach is used to quantify the changes in water use achieved by three common municipal sector rationing policies: (a) restrictions on time of outdoor use, (b) price increases, and (c) mandatory quantity restrictions (2) A model was presented for determing the optimal long term price schedule for rationing a stochastically variable water supply during summer peak demand season among groups of municipal water users which have different demands. (3) The third model analyzed various management policies in terms of their impact on net benefits to the agricultural and municipal sectors. The model is capable of modifying policies monthly, based upon the chaning hydrologic situation. It can vary constraints in a manner that simulates an institutional environment ranging from total freedom of price changes and water exchanges between sectors to those constraints existing during the 76-77 drought. Conclusions include: 1) Mandatory water use regulations are much more effective than price increases in reducing water use (at least in a short term drought). 2) A theoretical analysis of demand and supply functions showed that Salt Lake City's pricing polity (about $0.25/1000 gallons) is very close to optimal. 3) The third model showed that very substantial losses in consumer surplus in Slat Lake County during the drought were caused by variuos institutional restrictions.

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