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The purpose of this study is to investigate on institutional changes of water resource management in the Heihe River basin through State-Structure-Conduct-Performance (SSCP) model simulation on basis of theories of ecological economics and institutional economics.We thoroughly analyze ecological values of water resources and water quality in the Heihe River basin,following findings are achieved: (1)The current water resource management system of Heihe River Basin is partly positive to improve economic efficiency in water resources use.