Self-selection bias and manufacturing firms' demand for water recirculation
AbstractRelatively little is known of the factors which might influence firms' water recirculation decisions. This paper estimates an econometric model that accounts for potential self-selection bias and considers two facets of firms' recirculation behaviour: first, the discrete decision of whether to recirculate and, second, the decision of how much to recirculate. The model is estimated by applying the Heckman two-stage estimation procedure to data from Environment Canada's Industrial Water Use Survey. In the first stage, long run factors such as relative water scarcity and production technologies are found to influence the decision whether to recirculate water. In the second stage, the imputed prices of intake water and water recirculation as well as the scale of operations are found to influence the choice of the optimal quantity of water to recirculate.
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Bibliographic InfoPaper provided by Brock University, Department of Economics in its series Working Papers with number 0902.
Length: 26 pages
Date of creation: Feb 2009
Date of revision: Feb 2009
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More information through EDIRC
water demand; rericulation; Heckman;
Find related papers by JEL classification:
- Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
- Q21 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Demand and Supply; Prices
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-07-17 (All new papers)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Diane Dupont & Steven Renzetti, 2001. "The Role of Water in Manufacturing," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 18(4), pages 411-432, April.
- Steven Renzetti, 1992. "Estimating the Structure of Industrial Water Demands: The Case of Canadian Manufacturing," Land Economics, University of Wisconsin Press, vol. 68(4), pages 396-404.
- Arnaud Reynaud, 2003. "An Econometric Estimation of Industrial Water Demand in France," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 25(2), pages 213-232, June.
- Joel Bruneau & Steven Renzetti, 2010. "A Longitudinal Study of Water Recycling in Canadian Manufacturing Plants," Working Papers 1001, Brock University, Department of Economics.
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