The Effects of Regional Water Resource Allocation in Integrated Water-Economy- Environment Index on Sustainable Economic Growth of Iranian Provinces

Despite the consensus among all experts that water bankruptcy will be the main development challenge in Iran for the coming decades which can threat Iran's regional development and food security; there is still no integrated water-economy-environment index system for allocation of water resources in Iranian provinces. Therefore, the purpose of this study was to investigate the effects of regional water resource allocation in integrated water-economy- environment index on the economic growth of Iranian provinces.

After determining the integrated regional water-economy-environment index based on the recent theoretical and empirical literature, the integrated regional index was estimated for water resource allocations in 31 Iranian provinces using fuzzy comprehensive evaluation method and improved entropy approach. About 55 data titles were collected from various databases including Provincial and National Statistical Yearbooks, Statistical Centre of Iran, Ministry of Industry, Mine and Trade, Agricultural Statistical Yearbook, Agricultural Technical Research Institute. Finally, the effect of regional water resource allocations in water-economy-environment index on economic growth of Iranian provinces was estimated during the period from 2012 to 2018 using Generalized Method of Moments (GMM) approach.

Estimation of the total index with 5 main components revealed that Gilan, Mazandaran, Chaharmahaal & Bakhtiari and Khuzestan provinces can be suggested as the most suitable provinces to implement domestic virtual water strategy. The final results proved that policy making for implementation of virtual water strategy should be conducted regionally and individually based on the status of each province in water-economy-environment components of regional integrated index. Finally, the results of the study indicated that integrated regional water-economy-environment index had a positive and significant effect on economic growth of Iranian provinces.