Research On Water Rights Trading Mode Based On Option Perspective

China’s water resources are unevenly distributed in time and space and have a small per capita share,which belongs to the country of water shortage.Under the condition of implementing the most stringent water resources management system in our country,water conflicts between industries and departments are bound to intensify.As an innovative water rights trading mode,water option has been widely used in foreign countries.Practice has proved that it is an effective way to alleviate the water shortage between industries and departments.At this stage,it is of great theoretical and practical significance to study the water option trading mode suitable for China’s national conditions and to use water option trading to promote the development of short-term and medium-term water rights trading in China.This paper uses the method of combining normative analysis with empirical analysis to systematically study the trading mode of water options.Firstly,it expounds the development of water market and water rights trading in China,combs and analyses the existing water rights trading modes and their the characteristics,and then introduces the water rights trading mode based on option perspective.Secondly,it expounds the application basis and significance of water options trading,and specifically analyses the connotation,transaction main body,transaction process,pricing method.On this basis,the cost-benefit model of water option trading is constructed.Then,an empirical analysis of water option trading in the industrial sector of the water-receiving area of the Transfer-Han-To-Wei Project is conducted.Finally,some policy suggestions are put forward for the smooth development of water option trading in China.In the long run,the water demand in the water-affected area of the project will continue to increase and exceed the water supply in the water-affected area,and the water price of each department will increase.For the industrial production sector which is greatly affected by the water price,water option trading will help to reduce the risk of water supply and demand,the risk of water price fluctuation and the future of the industrial production sector According to the cost-benefit analysis of water option trading,with the increase of water option validity period,the trading cost and income of water option increases correspondingly,but the ratio of net income to cost increases first and then decreases.Therefore,compared with the long-term water option trading,the short-term and medium-term trading advantages are more obvious.Therefore,this paper encourages the water use sector to carry out short-term and medium-term water option trading,in order to reduce the cost of water use,improve regional economic development and alleviate water shortage.