Withdrawing Liquid Assets

How Demographic Trends Affect the Freshwater Supply

by Jill Boberg

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Research Brief


Water availability has become a pressing concern in recent years due to unprecedented growth in the earth's human population. Demographic factors, including population size, distribution, and composition, influence the demand for fresh water in agriculture, industry, and domestic life. To avoid a worldwide water crisis, water management policies must address the impact of these factors on both supply and demand and establish reforms to enable people to use the existing freshwater supply more efficiently.

Even though Earth has 1.4 billion cubic kilometers of water, only 200,000 cubic kilometers of it (0.014 percent) is fresh water accessible for human use. Water availability has become a pressing concern in the past few decades because of unprecedented growth in the human population—the demand for fresh water continues to grow while the supply remains finite. Demographic factors, such as population size, distribution, and composition, influence the demand for fresh water both directly and indirectly. A report recently published by Population Matters, a RAND Corporation project, explains that knowing the effects of each of these factors is critical to understanding the future of water resources and designing effective, sustainable water-management policies.

Many Human Activities Tap the Freshwater Supply

Human use of fresh water is commonly divided into three sectors: agricultural, industrial, and domestic. The figure shows the proportions of water demand by sector for six continents and the world.

In agriculture, which accounts for nearly 70 percent of all freshwater usage worldwide, farmers use water to irrigate crops and maintain livestock. In industry, which accounts for about 20 percent of water withdrawals worldwide, manufacturing and other processes consume water for functions such as cooling and cleaning. And in everyday life, people draw on water for many domestic uses, including drinking, cooking, cleaning, and landscaping, and these activities account for the remaining 10 percent. Among the continents, the relative quantities of water withdrawals differ notably across the sectors. However, the agricultural sector dominates water withdrawals, and its influence generally decreases with higher levels of industrialization. Only in South America and Africa does the domestic sector withdraw more water than does the industrial sector, reflecting relatively low levels of industrialization. Because of the many ways in which people use fresh water, the world's changing demographics have a strong influence on the future of the Earth's freshwater supply.

Estimated Sectoral Water Withdrawals by Region, 1995 (Percent of Annual Total)

SOURCE: United Nations and World Meteorological Organization, Comprehensive Assessment of Freshwater Resources of the World, New York: World Meteorological Organization, 1997.

Changing Demographics Can Strain Water Resources

Population size, number of households, urbanization, and economic development all influence the amount of water withdrawn and the quality of the water available.

Population Size and Number of Households

In the 20th century, the world's population grew from 1.65 billion to six billion, and now in the 21st century, the population continues to grow. Although the relationship is not linear, larger populations generally require more water than do smaller ones. The number of households worldwide has also increased, and at a faster rate than population has grown. Lower fertility rates, higher divorce rates, aging populations, and a decline in multigenerational family units all contribute to the increase in the number of households. The increased number of households affects freshwater resources in two ways. First, members of smaller households consume more water and create more waste on a per-capita basis because they lack the economies of scale available to members of larger households. Their smaller size also makes investments in technical water-saving measures less cost effective; for example, a water-saving toilet costs the same amount whether it serves a household of one or eight. Second, the transition toward smaller household size requires more housing units, which cover more land. When the land is paved, polluted and unfiltered water flows directly to bodies of water and diminishes the quality and quantity of the freshwater supply.

Migration and Urbanization

Migration affects water resources through the changes it creates in the landscape. People may migrate from one location to another due to deforestation, desertification, drought, or lack of arable land. A shortage of water or suitable farmland may drive people to migrate to cities, where urbanization puts further pressure on the available water resources.

Urbanization has increased greatly worldwide in the last half century, and urban populations are expected to match rural ones in size by 2007. This increase in urbanization has a number of consequences for water resources. First, the density of population in cities concentrates high demand on the local water resources, which depletes the local water supply and disrupts the local ecosystems. With further growth, cities tap into new sources farther away and extend the negative effects on the environment. Second, urban areas often create more waste than the surrounding environment can absorb. The increased waste and changes in land use result eventually in groundwater contamination, which further reduces the supply of fresh water. Third, urban areas are more likely to use waterborne sanitation systems, which flush waste into a sewage system in which the water must be treated. These sanitation systems alone increase the demand for fresh water by about 40 liters per capita per day.

Sanitation and access to clean water are critical health concerns because of water's key role in fighting disease. In the developing world, rapidly expanding cities and rural areas with inadequate water and sanitation infrastructures face greater health risks due to the lack of clean water for drinking and washing.

Economic Development

A country's level of economic development also influences its freshwater use. Developed countries tend to use water more efficiently than do developing countries, especially in the industrial sector. However, because of greater economic activity, they also use more water per capita to run industry, grow food, produce electricity, and process waste. Furthermore, populations in industrialized countries use more water to support individual and societal lifestyles, and they demand more water-intensive products and services (e.g., water-borne sanitation systems, energy products, and manufactured goods, which may require large amounts of water to produce).

Water Management Can Mitigate the Effects of Changing Demographics

Localized and regional water problems will continue to plague areas with unfavorable physical, social, economic, and cultural conditions. However, a worldwide water crisis can be averted through improved water management practices that take into account the influence of demographics on local and global resources, as well as the importance of mitigating factors such as economic development and the sectoral distribution of water. New water-management policies must aim to reduce the impact of demographic factors, such as population growth, urbanization, and the increase in the number of households. Some of the tools available for managers are those that help to reduce demand and augment supply. On the demand side, they include market-based incentives, nonmarket instruments (e.g., laws and regulations), and direct interventions. Tools on the supply side include spatial reallocation, temporal reallocation, water harvesting, reclamation, and desalination. Equally important is a revamping of the governance of many water systems. Some areas may require comprehensive reforms to enable people to use existing supplies of water efficiently rather than continuing to deplete the freshwater supply.

This report is part of the RAND Corporation Research brief series. RAND research briefs present policy-oriented summaries of individual published, peer-reviewed documents or of a body of published work.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.