Jiajing Sun

Jiajing Sun

PhD, CFA, FIMA, Member of the London Mathematical Society. Associate Professor and the Deputy Director of the Department of Statistics and Data Science, School of Economics and Management, University of the Chinese Academy of Sciences.

Virtual Water in Global Supply Chains: Trade Structure, Industrial Composition, and Policy Levers

Published in Ecological Economics, 2026

Abstract

Ecological economists and environmental managers use footprint and input-output tools to trace how production and trade redistribute pressure on freshwater systems. We examine how international supply chains transmit green, blue, and grey virtual-water and how these flows relate to countries’ development paths. Using the Eora multi-region input-output framework, we construct country-year measures of net and gross embodied-water outflows for 189 countries over 2010-2021 and link them to macro metrics from the World Development Indicators.

Three results stand out. Total water withdrawal is positively associated with blue and grey-water net outflows and with gross outflows of all three components. Manufacturing is most strongly associated with grey-water outflows, consistent with pollution-intensive production. In growth regressions, green and grey-water outflows are positively associated with GDP growth, unlike blue-water outflows, and we find no generic macro-level water resource curse. The findings underscore the need to distinguish rainfall-based, withdrawal-based, and pollution-related water pressures when interpreting embodied-water trade.

The manuscript is not hosted on this website due to copyright considerations.

Authors

Weimin Jiang1, Jiajing Sun2,*, Michael Cole3, and Yuanbo Zhang1

Affiliations

  1. College of Economics and Management, Nanjing Forestry University, Nanjing 210037, Jiangsu, China.
  2. MOE Social Science Laboratory of Digital Economic Forecasts and Policy Simulation, School of Economics and Management, University of the Chinese Academy of Sciences, No. 1 Zhongguancun South Street, Haidian District, Beijing 100190, China.
  3. Management School, University of Liverpool, Liverpool L69 7ZH, United Kingdom.

Corresponding author: Jiajing Sun (jiajing.sun@gmail.com)

Author Email Addresses

Recommended citation: Jiang, W., Sun, J., Cole, M., & Zhang, Y. (2026). "Virtual water in global supply chains: Trade structure, industrial composition, and policy levers." Ecological Economics, 248, 109068.
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