Carey School of Business, Arizona State Univ. / by Professor Tim James, et al.
[Wall Street Journal] A new study for the first time quantifies the economic importance of Colorado River water to seven Western states—and the dire outcome should ongoing droughts dry up even a portion of it.
The river’s water fuels $1.4 trillion in annual economic activity in California, Arizona, Nevada, Utah, Colorado, New Mexico and Wyoming, says the research by economists at Arizona State University. With just a 10% reduction in the water available for human use the gross economic product of those states would fall by $143 billion and cost 1.6 million jobs.
At a 20% drop, those numbers would shoot up to $287 billion in lost economic activity and 3.2 million jobs, according to the study.
The study assumes that no increase in water from other sources would be available. Those states, all of which have contractual rights to water from the Colorado, so far have managed to largely offset reductions in river flow brought on by a 15-year drought by drawing from underground reserves and stepping up conservation, among other measures.