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Charges for Water and Access: What Explains the Differences in West Virginia Municipalities?

Author

Listed:
  • Elham Erfanian

    (Regional Research Institute, West Virginia University)

  • Alan R. Collins

    (Davis College Division of Resource Management, West Virginia University)

Abstract

Applying linear and log-log functional forms plus spatial econometric analyses to a dataset of 125 municipal water utilities, we investigate the determinants of charges for water use and minimum monthly access to water across West Virginia municipalities in 2014. Water charges models are consistent with the theory of water cost determination as water source, debt, and economies of size plus scale influence what household consumers pay for water. Based on model results, groundwater use by utilities lowers water charges and is estimated to save household customers in West Virginia over $3.6 million annually. West Virginia households typically pay far below the OECD standard of 3 to 5% of household income for municipal water, which may explain why socioeconomic factors do not influence minimum charges for access.

Suggested Citation

  • Elham Erfanian & Alan R. Collins, 2017. "Charges for Water and Access: What Explains the Differences in West Virginia Municipalities?," Working Papers Working Paper 2017-02, Regional Research Institute, West Virginia University.
    • Handle: RePEc:rri:wpaper:2017wp02
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    File URL: https://researchrepository.wvu.edu/rri_pubs/32/
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    More about this item

    Keywords

    water charges; social equity; utilities; spatial econometrics;
    All these keywords.

    JEL classification:

    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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