Considering the Effect of Uncertainty in an Input-Output Analysis of Water Consumption: A Fuzzy Approach Applied to Macedonia

This paper deals with reconsidering the reliability of the results obtained in the input-output analysis of water consumption by Hristov et al. (2012) due to uncertainty integrated in the data. The imprecision and uncertainty is studied within a workable fuzzy environment introduced by Beynon et al. (2005) where rank reversal is plausible. In addition, the water intensive structure of the Macedonian economy is investigated by applying Dietzenbacher eigenvector methodology (1992) in terms of water consumption. Similar as in the analysis in the work by Hristov et al. (2012), the water intensive structure in Macedonia mainly focused around agriculture and several industrial sectors is confirmed, given the fact that rank reversal was absent. Consequently, necessity to introduce changes in the agricultural production technology and specialization in the production in this region or maybe reconsidering the existing water pricing policy ought to be carefully considered by the policy makers.