Conference Agenda

Terrestrial water storage (TWS) is the total amount of water in all continental storage compartments and is an essential resource for food and energy production, manufacturing and ecosystem health. Even though absolute TWS is unknown, satellite gravimetry-based methods enable global estimations of spatial and temporal TWS changes, revealing significant alterations over the past two decades due to natural variability, direct human influence, and climate change. Here we show that declines in TWS reduce economic production worldwide. Combining GRACE TWS anomaly measurements from 2004 to 2018 with data on macroeconomic growth from more than 1600 subnational regions worldwide, we isolate the impact of climate-induced TWS changes on growth by means of three complementary empirical strategies. Using a long-difference approach and fixed-effects panel regressions with either a control for human water consumption or an instrumental variable approach, we find consistent evidence for negative economic impacts of TWS declines. Among the regions with the largest TWS-induced growth rate reductions are the Caspian Sea Region and India, whereas others such as in Tanzania or the US Mid-West benefitted, pointing to pronounced regional heterogeneity even within countries. To further investigate this heterogeneity in response to TWS change, we combine a leave-one-out sensitivity analysis with tree-based classification techniques and a feature importance analysis. The results imply that regions with a high share of agricultural area or low income per capita experience higher economic losses under declining TWS, pointing to an exacerbation of global economic inequality. Our findings contribute to the discourse on sustainable water management and its implications for economic prosperity.