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Forecasting the Public's Acceptability of Municipal Water Regulation and Price Rationing for Communities on the Ogallala Aquifer

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Author Info

  • Edwards, Jeffrey A.
  • Wade, Tara R.
  • Burkey, Mark L.
  • Pumphrey, R. Gary

Abstract

Among many, increasing the price of municipal water is considered to be the most effective mechanism for enhancing municipal water conservation, whether during times of drought or not. However, increasing the price of something that is considered to be, literally, a life-giving resource is politically taboo. This study follows two others that evaluate survey data with Likert scale responses, in determining whether or not constituents would outright reject the idea of using price to ration municipal water. But it goes several steps further--it controls for both community and respondent level variables, calculates and evaluates in-sample response probabilities, and most importantly, attempts to forecast the attitudes of constituents in communities that are not in our survey sample. In the end, our model produces both in-sample and out-of-sample response probabilities that are reasonable, and relatively stable across communities; it therefore provides communities and researchers with a means to gauge public support for pricing initiatives.

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Bibliographic Info

Paper provided by Agricultural and Applied Economics Association in its series 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. with number 149579.

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Date of creation: 2013
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Handle: RePEc:ags:aaea13:149579

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Related research

Keywords: water conservation; water pricing; regulation; ethanol; Likert scale; ordered logit; Environmental Economics and Policy; Q25; Q56; R52;

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  1. Pumphrey, R. Gary & Edwards, Jeffrey A. & Becker, Klaus G., 2008. "Urban and rural attitudes toward municipal water controls: A study of a semi-arid region with limited water supplies," Ecological Economics, Elsevier, vol. 65(1), pages 1-12, March.
  2. Sheila Olmstead & W. Michael Hanemann & Robert N. Stavins, 2007. "Water Demand Under Alternative Price Structures," NBER Working Papers 13573, National Bureau of Economic Research, Inc.
  3. Papke, Leslie E. & Wooldridge, Jeffrey M., 2005. "A computational trick for delta-method standard errors," Economics Letters, Elsevier, vol. 86(3), pages 413-417, March.
  4. Polyzou, E. & Jones, N. & Evangelinos, K.I. & Halvadakis, C.P., 2011. "Willingness to pay for drinking water quality improvement and the influence of social capital," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 40(1), pages 74-80, February.
  5. Christopher Timmins, 2003. "Demand-Side Technology Standards Under Inefficient Pricing Regimes," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 26(1), pages 107-124, September.
  6. Hugh Sibly, 2006. "Efficient Urban Water Pricing," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 39(2), pages 227-237, 06.
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