A Longitudinal Study of Water Recycling in Canadian Manufacturing Plants
Industrial water use is an important part of most developed economies' total water use and one which is differentiated from other sectors' water use by the prevalence of recycling. Previous research applied to cross sectional surveys has identified the role of input prices and the scale of plant operations in determining the volume of water recirculated. We, on the other hand, employ longitudinal data to investigate the frequency of recirculation (that is, whether manufacturing plants recirculate or not). Our analysis of the data from several cross sections from Canada's Industrial Water Survey data shows that, while there are a number of pants that either never or always recirculate water, there is a sizable minority of plants who at times are observed to be recirculating and at other times are observed not to be recirculating. In order to investigate these phenomena, we construct a 'pseudo-panel' of data (Deaton, 1985) and estimate a fixed effects model of recycling frequency. Our estimation model provides insights into industrial water recycling. In particular, the scale of plant operations is not found to be significant in explaining the likelihood of recirculation while water-related input prices are significant.
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- 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.
- Deaton, Angus, 1985. "Panel data from time series of cross-sections," Journal of Econometrics, Elsevier, vol. 30(1-2), pages 109-126.
- Sankar, . Ulaganathan (ed.), 2001. "Environmental Economics," OUP Catalogue, Oxford University Press, number 9780195659139.
- Steven Renzetti & Joel Brueau & Michel Villeneuve, 2009. "Self-selection bias and manufacturing firms' demand for water recirculation," Working Papers 0902, Brock University, Department of Economics, revised Feb 2009.
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