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Measuring Price Elasticities for Residential Water Demand with Limited Information

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Listed:
  • H. Allen Klaiber
  • V. Kerry Smith
  • Michael Kaminsky
  • Aaron Strong

Abstract

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.

Suggested Citation

  • H. Allen Klaiber & V. Kerry Smith & Michael Kaminsky & Aaron Strong, 2012. "Measuring Price Elasticities for Residential Water Demand with Limited Information," NBER Working Papers 18293, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:18293
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    References listed on IDEAS

    as
    1. Jasper M. Dalhuisen & Raymond J. G. M. Florax & JHenri L. F. de Groot & Peter Nijkamp, 2003. "Price and Income Elasticities of Residential Water Demand: A Meta-Analysis," Land Economics, University of Wisconsin Press, vol. 79(2), pages 292-308.
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    More about this item

    JEL classification:

    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water

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