A novel data-driven analytical framework on hierarchical water allocation integrated with blue and virtual water transfers

Abstract

In this study a novel data-driven analytical framework is proposed for cooperative strategies that ensure the optimal allocation of blue and virtual water transfers under different hydrological and economic conditions. A Stackelberg-Nash-Harsanyi equilibrium model is also developed to deal with the hierarchical conflicts between the water affairs bureau and multiple water usage sectors and overcome problems associated with water scarcity and uneven distribution. It was found that cooperative blue and virtual water transfer strategies could save water and improve utilization efficiency without harming sector benefits or increasing the ecological stress. Data-driven analyses were employed to simulate the hydrological and economic parameters, such as available water, crop import price and water market price under various policies. By adjusting the hydrological and economic parameters, it was found that the optimal allocation and transfer strategies were more sensitive to hydrological factors than economic factors. It was also found that cooperative blue/virtual water transfers respond to market fluctuations. Overall, the proposed framework provides sustainable management for physical and virtual water supply systems under future hydrological and economic uncertainties.