NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Water Quality Violations and Avoidance Behavior: Evidence from Bottled Water Consumption

Joshua Graff Zivin, Matthew Neidell, Wolfram Schlenker

NBER Working Paper No. 16695
Issued in January 2011
NBER Program(s):   EEE   HE

In this paper, we examine the impact of poor water quality on avoidance behavior by estimating the change in bottled water purchases in response to drinking water violations. Using data from a national grocery chain matched with water quality violations, we find an increase in bottled water sales of 22 percent from violations due to microorganisms and 17 percent from violations due to elements and chemicals. Back-of-the envelope calculations yield costs of avoidance behavior at roughly $60 million for all nationwide violations in 2005, which likely reflects a significant understatement of the total willingness to pay to eliminate violations.

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Document Object Identifier (DOI): 10.3386/w16695

Published: Joshua Graff Zivin & Matthew Neidell & Wolfram Schlenker, 2011. "Water Quality Violations and Avoidance Behavior: Evidence from Bottled Water Consumption," American Economic Review, American Economic Association, vol. 101(3), pages 448-53, May.

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