Finding a sustainable balance in the water food nexus–Socio-economic transformation in an agricultural catchment

Abstract

Increasingly the competition for water between food production and the environment threatens the viability of agricultural communities. This paper focused on this water-food-environment nexus in the Murrumbidgee River Basin, Australia, and how it contributed to the evolution of the regional economy and changing demographic patterns. Paradoxically, against expectations, changes in water management favouring the environment coincided with falling unemployment and increase in average regional income, despite a decline in agriculture. To understand this, and to explore how the competition for water played out in the Murrumbidgee Basin, we develop and use a socio-hydrologic model that explicitly considers bi-directional feedbacks between human and water systems. The modelling shows that in response to widespread ecosystem degradation, community sentiment forced new water management policies that favoured ecosystems which inevitably led to reductions in agriculture production. In response, the basin economy reorganized through sectoral transformation to the manufacturing and service sectors, improved agricultural practices, and out-migration of basin residents. The sectoral transformation was facilitated by capital available for investment in manufacturing and service sectors with knock-on impacts on population dynamics and unemployment. Collectively these contributed to a sustainable transformation of the basin economy. The study shows how transformation of the basin economy and demographics mitigated potentially adverse economic outcomes and enabled society to cope with water management decisions that favoured the environment. The dynamics outlined here highlight the adaptive capacity of people and movement of capital in a free economy, supported by appropriate strategies and funding, to cope with water stress.