42 PERSPECTIVES ON BUSINESS AND ECONOMICS | VOL 42 | 2024 untreated water for other household duties and religious practices. Through recent application of the increased supply approach, however, access to water for such native groups has been reframed. Where water was once viewed as a precious and finite resource, the construction of nearby desalination plants and installation of distribution network connections has misconstrued water supplies as now infinite. The changed perception of the availability of water subsequently affects Moroccans’ willingness to limit water consumption, rebounding to utilize clean water sources for superfluous purposes (Meerganz von Medeazza, 2004). Studies on water scarcity in the Moroccan economy also highlighted the rebound effect and water availability. In the agricultural sector, rebound effects can be observed by connecting the introduction of water-efficient technologies to the transitions to more water-intensive agricultural products. When minimal water-efficient technologies (5% improvement rate) are implemented in conjunction with water-intensive crop choices, the ideal results should yield an equivalent (5%) decrease in water demand. However, Morocco is instead projected to experience a 4.1% increase in demand for water and then a 9.1% rebound effect. That is, rather than reducing demand for water, the investment in efficient technologies actually induced additional demand and stress on the water supply. If the improvement rate of water-efficient technologies is expanded to a maximum of 20%, a reduction in the demand for water can be observed. However, such a reduction in demand is so limited that the rebound effect remains present, highlighting a likely negative return on investment. Similar trends are also seen in cases where the transition to water-intensive crops has not yet occurred: a rebound effect is still present despite some reduction in water demand (Taheripour et al., 2020). Given such projections, the implementation of water-efficient agricultural or increased supply management technologies will not resolve concerns of water scarcity on their own. To effectively address all segments of water scarcity, the range of solutions must also integrate demand management programs to reach the desired return on investment. Implementing technological solutions in response to water scarcity alone is not economical in the long run. While desalination technologies or other alternatives boast an opportunity to increase supply, those same technologies lack the ability to address the subsequent demand and consumption dilemmas they create. An expected economic benefit of an expanded water supply is stimulated growth in the agricultural sector focused on increased profit from higher-value, water-intensive crops or greater volumes of standard crops. With the high costs of desalination raising the cost of water as an input, coupled with the continued decline in total water availability, any predicted profit aimed at supporting a growing Moroccan economy cannot be sustained. Instead, to ensure a sustained growth in the agriculture sector, policymakers must work to institute a strong demand management plan to balance the existing supply-based, technological approach to water availability. The influence of water subsidies Looking forward, a demand management plan in Morocco should aim to incentivize continued conservation of the available water supply. Unfortunately, the increased access to water has led native groups to abandon the use of nonpotable water for religious rituals, eliminate their underground rain collection tanks, and return to using clean water for routine domestic purposes. Meanwhile, the agricultural sector has increased its consumption of water with the motivation to grow the Moroccan economy. Many of these instances of increased water consumption have been spurred by the ease in financially accessing water resources. Government-sponsored water subsidies enable substantially low water prices that do not deter individual Moroccans and businesses from overconsumption. Noting the high influence Moroccan water subsidies seemingly has on deepening the country’s water stress, a 2014 International Congress of the European Association of Agricultural Economists presentation (Thabet et al., 2014) discussed the removal of such subsidies and the Moroccan economy. The authors’ findings were based on generated values for computable general equilibrium scenarios, assessing the economic cost of a 50% decrease in subsidies, a 50% increase in investment of water supply expansion strategies, or a combination of the two. They determined the weight the agricultural sector holds within the entire Moroccan economy limits the country’s flexibility in shifting financial investments to create such demand management scenarios. The report recognized that a drastic removal of subsidies may not be within the government’s current scope for managing ongoing water demand concerns or modify agricultural water usage tendencies to the desired extent. However, the report also implied that the situation might change when “a very high water price is reached” (p. 11). When the price of water increases to such a level, its percentage contribution of the total cost of production may incentivize farm-
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