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Water price as a policy variable in managing urban water use: Tucson, Arizona
Author(s) -
Martin William E.,
Kulakowski Susan
Publication year - 1991
Publication title -
water resources research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.863
H-Index - 217
eISSN - 1944-7973
pISSN - 0043-1397
DOI - 10.1029/90wr02088
Subject(s) - per capita , economics , water use , order (exchange) , inflation (cosmology) , variable (mathematics) , econometric model , natural resource economics , econometrics , mathematics , finance , ecology , population , mathematical analysis , physics , demography , sociology , theoretical physics , biology
An informal analysis of readily available time series data relevant to urban water use in Tucson, Arizona, is presented as an illustration of how a management‐oriented empirical analysis, structured with general knowledge of the results of formal econometric studies, can produce useful insights for making applied price policy. Precise estimates of urban water demand price and income elasticities are not required in order to achieve conservation‐oriented goals. In the Tucson experience, annual water price increases equal to the rate of inflation plus approximately the rate of change in real per capita income would have been necessary just to maintain constant rather than increasing water use. Given the actual price policy, it is not surprising that Tucson has not achieved its mandated conservation goal.