Measuring Price Elasticities for Residential Water Demand with Limited Information
This paper exploits the seasonal and annual changes in marginal prices for water to estimate the price elasticity of demand by residential households for water. It uses the changes in distributions of water using the census block group levels in response to changes in marginal prices of water for matched months across years. This strategy reduces the interaction effects of outdoor use and demographic fact in determining responsiveness to price. By comparing years that vary in overall water availability the framework can recover measures of how responses to price vary with season and draught conditions. The application is the urban Phoenix metropolitan area.
Partial support for this research was provided by the Decision Center for a Desert City. Special thanks are due two referees for exceptionally careful and constructive comments on an earlier draft of this paper. We are responsible for any remaining errors. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.
H. Allen Klaiber & V. Kerry Smith & Michael Kaminsky & Aaron Strong, 2014. "Measuring Price Elasticities for Residential Water Demand with Limited Information," Land Economics, University of Wisconsin Press, vol. 90(1), pages 100-113. citation courtesy of