Acta Geographica Sinica ›› 2000, Vol. 55 ›› Issue (3): 318-328.doi: 10.11821/xb200003008

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Analysis on Marginal Revenues of Water in Hebei Province

WANG Zhi yong, WANG Jin feng, YU Jing jie, LIU Chang ming   

  1. Institute of Geography, Chinese Academy of Sciences, Beijing 100101
  • Received:2000-03-31 Revised:2000-04-10 Online:2000-05-15 Published:2000-05-15
  • Supported by:
    the Project of Chinese Academy of Sciences,No.KZ951-A1-203 and KZ951-A1-302

Abstract: This paper gives the method for computing the marginal revenue of water in industrial sector and agricultural sector and illustrated the process of data treatment taking Baoding district as an example. Before calculating the marginal revenue of water, a lot of work has to be done to make the production conditions comparable. For the sake of data restriction, we take the fixed capital as the primary consideration while calculating the marginal revenue of water in industrial sector. The fixed capital always coordinates with a certain amount of floating capital. Thus, to some extent, change in fixed capital stands for the total capital amount in work. We also consider the elasticities of output to capital and to labor respectively, which we calculate as the weight in computation. We assume the elasticity of output to capital equals to 0 91, while 0 1 as the elasticity of output to labor. Therefore, the weight of each calculation is around 1 09, which equals to the reciprocal of elasticity of output to labor. While in calculation, we use the following formula: MR=Y i+t ∏tk=1g i+k ·w t-Y iX i+t -X i where Y is the total output in industrial sector, X is the water amount used in industrial sector, g is the growth rate of fixed capital investment and the w means the weight got from elasticity output to capital and to labor. We assume that there is no delay in capital investment, which means all the investment will be in force right after the plan is fulfilled. Actually, if data is available, we should consider the time lag of investment. As referring to the calculation of marginal revenue of water in agriculture, we use similar means to compute. Taking the agricultural sector as a whole, we consider the total mechanic force as the fixed capital in agriculture, which measures the primary agricultural devices. Besides, we consider the natural disasters that affect the output in agriculture. There also exist the elasticities of output to capital and to labor. Thus we have the weight to reflect the elasticities and natural disasters. Using the similar way, we can also calculate the aggregated marginal revenue of water both in industrial and agricultural sector. The conclusion of our computation and analysis is that the marginal revenue of water is diminishing, regardless the sectors that use water. In general, industrial sector has the higher value of marginal revenue of water than agricultural sector. Different districts have different average marginal revenues of water due to differences in capital amount.

Key words: water use for industrial and agricultural sectors, marginal revenues of water, Hebei province

CLC Number: 

  • F062.1