A hybrid partial and general equilibrium modeling approach to assess the hydro-economic impacts of large dams: The case of the Grand Ethiopian Renaissance Dam in the Eastern Nile River basin

Tewodros Negash Kahsay*, Diane Arjoon, Onno Kuik, Roy Brouwer, Amaury Tilmant, Pieter van der Zaag

*Corresponding author for this work

Research output: Contribution to JournalArticleAcademicpeer-review

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Abstract

A novel integrated hydro-economic modeling framework that links a bottom-up partial equilibrium (engineering) model with a top-down (economic) general equilibrium model is developed for assessing the regional economic impacts of water resources management and infrastructure development decisions in a transboundary river basin. The engineering model is employed first to solve the water allocation problem for a river system in a partial equilibrium setting. The resulting system-wide changes in optimal water allocation are subsequently fed into the general equilibrium model to provide an economy-wide perspective. This integrated hydro-economic modeling framework is illustrated using the Eastern Nile River basin as a case study. The engineering-based stochastic dual dynamic programming (SDDP) model of the Eastern Nile basin is coupled with the computable general equilibrium (CGE) model GTAP-W to assess the economy-wide impacts of the Grand Ethiopian Renaissance Dam (GERD) on the Eastern Nile economies.

Original languageEnglish
Pages (from-to)76-88
Number of pages13
JournalEnvironmental Modelling and Software
Volume117
Early online date22 Mar 2019
DOIs
Publication statusPublished - Jul 2019

Keywords

  • Computable general equilibrium modeling
  • Eastern Nile countries
  • Grand Ethiopian Renaissance dam
  • Stochastic dual dynamic programming

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