An accurate and practically useful evaluation of regional water scarcity is a necessary procedure in scarcity monitoring and threat mitigation. From the perspective of virtual water, this study proposed an improved system dynamics model to evaluate regional water scarcity (WS), including a case study of Henan province, China. We enhanced the existing system dynamics model of WS evaluation from a virtual water perspective by (1) defining WS as the ratio of the consumption-based blue water footprint to water availability, in order to compare the water requirements that need to be met to satisfy the local demand of goods and services with water supply; (2) integrating the economic growth, trade, and water use efficiency in the tertiary industry (e.g., accommodation, food and beverage services) into the model, in order to improve the accuracy of WS assessment and help find more specific measures to reduce WS by factor adjustment; (3) distinguishing the product use structure matrix, as well as the sectoral direct water use coefficient, in local regions from that in other domestic regions and foreign countries, and identifying the regional use structure matrices of products from these three kinds of regions, in order to increase the calculating veracity; and (4) displaying performances of the society, economy, and environment in WS reduction, in order to offer a more comprehensive reference for practical policy decisions. The case study results show that Henan has been suffering from, and in the near future could continue to face, water scarcity, with an average of 2.19 and an annual rise of 1.37% during 2008–2030. In the scenario comparison of current development, production structure adjustment, technology upgrade, and trade structure adjustment in supply-side structural reform of Henan from 2019 to 2030, WS could be reduced by updating production structures into less production of agricultural products or other sectors with a high production-based water footprint (with the smallest average WS of 2.02 and the second smallest total population and GDP, i.e., gross domestic production), technology enhancement in water saving, purification and pollution control (with the second smallest average WS of 2.04 and the largest total population, GDP and total available water resources). Furthermore, for the agricultural products or other sectors with high domestic/international virtual water outflow (inflow), if we reduce (increase) their percentage of outflow (inflow) in the industry involved, WS will increase only more slightly than that when we keep the current development trend, with the smallest total population. Potential measures for alleviating WS should be taken comprehensively, with priorities being identified according to the socioeconomic and environmental performance. Our model can be useful for practical policymaking and valuable for relevant research worldwide.
System dynamics evaluation of household water use behavior and associated greenhouse gas emissions and environmental costs: A case study of Taipei city