Cross-Sectoral Analysis of Water Usage in Thailand Using Input–Output Model

Abstract

Thailand currently ranks third among the most water-intensive countries in the world. The percentage shares of water demand in the country’s agriculture, manufacturing, and service sectors, which are major economic sectors, are 75%, 3%, and 5%, respectively. With the continuous growth of the economy, the demand for water is steadily rising, while the expansion of water supply remains constrained by several factors and the water supply is also affected by climate change. This study uses the input–output model to examine the relationship between water usage and the economic system in Thailand in 2010. The constructed input–output model is the integration of the Leontief inverse matrix, the matrix of water usage, and the details of the gross domestic product (GDP). The model indicates the linkage between GDP expansion and water demand in both direct and indirect usage. The computation result obtained from the model indicates that the agricultural sector is the major water user, with its ratio of direct water use being the highest. The manufacturing sector records the highest ratio of indirect water use, which is influenced by its supply chain comprising the agriculture and service sectors. This model and its results may serve as the main foundation for the design of economic and environmental policies oriented toward optimizing water demand and supply. The model can also be extended and enriched with detailed mechanisms of economic behavior to allow further complex analyses such as water pricing policies.