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Policy relevance in studies of urban residential water demand
Author(s) -
Martin William E.,
Thomas John F.
Publication year - 1986
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/wr022i013p01735
Subject(s) - price elasticity of demand , economics , arid , econometrics , relevance (law) , elasticity (physics) , range (aeronautics) , natural resource economics , microeconomics , engineering , ecology , materials science , political science , law , composite material , biology , aerospace engineering
Precise estimates of demand elasticities for a given area may not be necessary for policy purposes. Given the general nature of the demand for urban water, simple cross‐sectional comparisons of prices and quantities in similar areas may be most reliable for policy use. Short‐run elasticities give little information for policy purposes. Comparison of well‐defined price and quantity data from five cities with similar arid environments suggests a long‐run price elasticity for residential water of about −0.5 over a wide range of water prices. The potential for price adjustments to affect use is enormous.