Should hydro-economic models be agent-based? Should they include non-economic behaviors and metrics?

Session H2: Water Resources Management and Planning - Modeling and Software for Improving Decisions and Engaging Stakeholders

Hydro-economic analysis represents the standard hydrological and engineering realities of water resource system along-side economic drivers and impacts. Often optimization is used to simulate profit-maximizing behavior which is assumed to drive most water use decisions. Recently, different modeling trends have bumped against traditional hydro-economic modeling and challenging it in new directions. One is agent-based modeling, understood as a field of analysis where the behavioral rules of individuals help understand/predict how the whole system functions. This challenges hydro-economic models to include non-economic driven rules or behaviors in addition to economic optimization. Multi-criteria optimization also challenges social-economic models to assess other performance metrics besides monetary ones. This extended abstract and talk will show two case-studies and discuss how these two areas could help progress the practice of hydro-economic modeling.