Entropy, recycling and macroeconomics of water resources

We develop a macroeconomic model of water quantity and quality supply multipliers derived from water recycling (Karakatsanis et al. 2013) and examine its statistical properties. Macroeconomic models that incorporate natural resource conservation have become increasingly important (European Commission et al. 2012) for national accounting. In addition, as an estimated 80% of globally used freshwater is not reused (United Nations 2012), with increasing population trends, water resource recycling becomes a solution of high priority. Recycling of water resources generates two major conservation effects: (1) conservation of water in reservoirs and aquifers and (2) conservation of ecosystem carrying capacity due to wastewater flux reduction. It is the properties of the distribution of recycling efficiencies –on quantity and quality- per sector that determine macroeconomic decoupling from geophysical uncertainty. Generally, uncertainty may statistically be quantified by entropy. Higher entropy signifies a greater dispersion of recycling efficiencies and potentially greater exposure to geophysical uncertainty; probably indicating the need for additional infrastructure for the statistical distribution’s both shifting and concentration towards higher efficiencies, supply multipliers and geophysical uncertainty decoupling.