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Estimation of residential water demand: a state-of-the-art review

This paper surveys the main issues in the literature on residential water demand. Several tariff types and their objectives are analyzed. Then, the main contributions to the literature on residential water demand estimation are reviewed, with particular attention to variables, specification model, data set, and the most common econometric problems. The paper concludes with comments on future trends and a summary of the contents of the study.

Household Size and Residential Water Demand: An Empirical Approach

The effectiveness of pricing policies depends on the price elasticity of consumption. It is well documented that residential demand for water is influenced by heterogeneity associated with differences in the size of the household and socioeconomic characteristics. In this paper, we focus on household size. Our initial hypothesis is that users’ sensitivity to changes in price is different depending on the number of household members. To this end, we carry out an empirical estimation of urban water demand in Zaragoza (Spain) distinguishing between households with different sizes using data at the individual level. As far as we are aware, this approach to urban residential water demand is new in the literature. The analysis suggests that all households are sensitive to prices regardless of size. A more relevant finding is that small households are more sensitive to price changes.

Potential for Pricing Policies in Water Resource Management: Estimation of Urban Residential Water Demand in Zaragoza, Spain:

This paper presents an empirical study to estimate the urban residential water demand in Zaragoza, Spain; this allows the testing of the short-run sensitivity of water demand to changes in a set of socioeconomic variables and especially in prices. A residential water demand model is estimated using a dynamic panel data technique. Furthermore, three water demand equations have been proposed and two alternative process specifications are applied. The empirical application suggests that the linear demand specification is the most adequate. Finally, the results indicate that domestic demands are inelastic with respect to price.

Tariffs for Urban Water Services in Spain: Household Size and Equity

The purpose of this work is to evaluate the consequences of tariffs that use sliding-scale prices to assess the aggregated consumption of households in terms of equity. Particular attention is paid to special tariffs for larger households. The study analyzes the tariffs that were in effect in Spanish provincial capitals in 2008. The results confirm that there are equity problems associated with the size of the household, particularly regarding large households. Furthermore, the results show that a large part of the special tariffs that have been adopted do not solve that equity problem.

Which factors determine water saving behaviour? evidence from spanish households

In this paper we propose to answer the following questions: What does the adoption of water saving measures by Spanish households depend on? Which factors have the most influence on water saving behaviour? To this end we have conducted an empirical study in which a binary model (probit/logit) with interaction effects between city size, educational level and climatic area, along with other quantitative and qualitative variables, is estimated using household level data. The results of this estimation, together with the evaluation of probability changes that occur when any of the qualitative factors change, suggest that the level of income, the size of the city where the dwelling is, the educational level of the reference person and the climatic location of the city are factors that influence the attitude towards saving water.