LINEAR PROGRAMMING USE FOR EVALUATING WATER RESOURCES AND COST AND BENEFIT ALLOCATION¹

Abstract

A linear programming model for a river basin was developed to include almost all water‐related economic activity both for consumers and producers. The model was so designated that the entire basin or basin sub‐division could be analyzed. The model included seven sectors, nine objective function criteria, and three river‐flow levels. Economic basis for conflicts among sectors over incidence of cost allocation and level of economic activity can be traced to some chosen objective. The disposal of untreated household waste water, particularly from the rural household, directly into the river was consistent with maximizing net benefits and minimizing costs. The optimum resource allocation, water‐treatment plants, farms and industry activities would change with flow level. For each of the three industries analyzed separately, paper, wool and tanning, public treatment of industrial waste water was the optimal treatment process in one or more of the solutions. Lake shoreline was the dominant feature determining lake‐resource valuation. Implied capital value varied from $126 per shoreline foot to over $250 depending on discount rate. Implied prices on lake surface ranged from $42 to $147 per acre. Strong economic forces encouraged small lot sizes for vacation cottages.

Optimization Models in Water Resources Management and Security: A Critical Review

“…brings distributional justice to water resources Unrealistic; multiple iterations of Simplex method add exponential complexities to modeling Hadley (1961), Dantzig (1963), Driebeck (1969), Drobny (1971), Klee and Minty (1972), Andrews and Weyric (1973), Karmakar (1984); Jacovkis et al (1989), Frizzone et al (1997), Iancheva and Kelevedzhiev (2001), Pearson and McRoberts (2010). Non-linear programming (NLP) using Lagrange multipliers High computational costs are involved, and various linearization schemes are adopted; local instead of global optimum; numerical noise Von Neumann and Morgenstern (1947), Kuhn and Tucker (1951), Kuhn (2014), Rydzewski and Rashid (1981),, Cullinane et al (1992), Berghoue and Kuczeraz (1997), Ghahraman and Sepaskhah (2002), Liberatore et al (2006),, Ahlfeld and Baro-Montes (2008), Venter (2010), Singh (2012), Aljanabi et al (2018).…”

THE IMPACT OF HIGH INTEREST RATES ON OPTIMUM MULTIPLE OBJECTIVE DESIGN OF SURFACE RUNOFF URBAN DRAINAGE SYSTEMS1

“…The theoretical issues associated with capital intensity at various rates of interest have been developed adequately by Wright (1973) and Aplin and Casler (1973). Cline (1973) examines the sensitivity of the rate of irrigation projects to the rate of interest, but only in the context of their benefitlcost ratio not in the context of capital intensity.…”

Determining Farmers’ Willingness to Pay for Irrigation Water in the Alentejo Region (Southern Portugal) by the Residual Value Method

“…LP has also been used for the last four decades to determine the value of water. Previous studies [11][12][13][14][15][16][17] attempted to valuate this resource based on mathematical models. However, LP is normally based on the single criterion of maximizing the economic return, lacking to be capable to maximize the valuation based on farmer's preferences and choices.…”