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Abstract

In many arid and semi-arid regions whether or not to use desalinated water has long been a non-issue and policy debates are focused on the timing and extent of the desalination activities. We offer a model to analyze how water scarcity and demand structure, on the one hand, and cost reduction via R&D activities, on the other hand, affect the desirable development of desalination technologies and the optimal time profiles of fresh and desalinated water supplies. The optimal R&D policy is found to follow a Non-Standard Most Rapid Approach Path (NSMRAP): The state of desalination technology—the accumulated knowledge from R&D activities—should approach a prespecified target process as rapidly as possible and proceed along it forever. The NSMRAP property enables a complete characterization of a comprehensive water policy in terms of a simple and tractable set of rules.

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