The behavior evolution and case simulation of water rights trading in water transfer projects

ABSTRACT Due to the difference in the economic and social development level of each area of the water transfer project, there will be a lack of water resources in some areas, while water resources in some other areas have a surplus, resulting in the imbalance of water resources. However, the transaction willingness of both parties is not strong, and the seller has the psychology of “reluctant to sell”. The buyer hopes to make free water allocation through the government. The paper analyzes the feasibility and influence of solving the imbalance of water resources in water transfer projects through the market mechanism by the evolutionary game approach. The water right transaction between Zhengzhou and Nanyang in the middle route of the South-to-North Water Transfer Project is taken as a case for simulation. The study shows t: the lower the marginal return of the water resources in the water-rich area is, the higher the water-scarce area is, the easier to promote water rights trading; the higher the environmental and social benefits for both parties are, the easier the water rights trading; the lower the transaction cost of both parties is, the easier the water rights trading.