Search

The development of reservoir storage capacity has been most closely connected to water demand for irrigation purposes. But water demand for this purpose is relatively elastic, while that for other uses is much less so. A model estimated here suggests also a positive relation between the price of irrigation water and an aggregate comprising mainly urban water use. As the pressure of rising demand against a relatively constant supply drives water prices upward, irrigation is thus likely to suffer in comparison to urban demand, and this should free up existing storage capacity for alternative uses. By implication, water managers should take this eventuality into account when formulating water resource strategies to meet future water needs. Keywords: Water; Storage; Government policy

The various inventory investment time series or measures in existence are reliable indicators of economic activities, fluctuations and business cycles in the US. Analysis shows that series 92, which measures changes in unfilled durable goods orders in 1982 dollars and which the US Bureau of Economic Analysis adopted in place of series 36, is a viable measure. However, series 92 was not found to be a much better predictor compared to the the series 36's inventories-on-order component. Complementing series 92 with series 36 results in a more stable lead indicator.

Switching models have been used previously to document the presence of multiple regimes in the growth rate of the US GDP. As fluctuations in inventory investment are known to play a major role in business cycles, it is likely that inventory growth patterns are also subject to alternating regimes. In the present paper, simple and Markov switching models are applied to inventory series at different levels of manufacturing and trade with a view to discovering the presence of multiple regimes. The findings suggest that the growth rate of retail inventories contains significant regime switches, and that these corresponds in all cases with switches in the GDP growth rate regime, though some extra switches are noted in the retail inventory series. [C] 2001 Elsevier Science B.V. All rights reserved. Keywords: Inventory investment; Business fluctuations; Cycles