Irreversibility and natural resource allocation: Applying Krutilla–Fisher model in water allocation

Abstract

Abstract Development projects that are created on the basis of using surface water resources such as rivers and lakes without considering the values of the ecosystem cause irreparable damage. Water transfer is one of the options of water management, which is done to allocate water to the agricultural, domestic and industrial sectors and reduces the ecosystem's share of natural water resources. Food supply, industrial development and population growth are the phenomena of the present condition, which are opposed to the ecosystem services that the future generation needs. This study has been carried out in order to develop an optimal control model for the allocation of a natural water resource considering irreversibility. This method is inspired by the Krutilla–Fisher model, which was developed in the form of the possibility of improving agricultural water management. The results showed that by applying optimal management in 25% of agricultural water use, it is possible to provide 100 and 65% of the ecosystem's water requirements in winter and summer, respectively. It showed that the allocation of river water for different uses in the current situation does not follow an optimal policy. In fact, it exacerbates environmental irreversibility in the ecosystem.