Economic development and residential water consumption in Chile

Juan Fercovic, William Foster and Oscar Melo

Environment and Development Economics, 2019, vol. 24, issue 1, 23-46

Abstract: A better understanding of the relative importance of factors related to climate change and to changes associated with economic growth would serve to inform water policy and to focus scarce public resources on anticipated problems arising from distinct sources of changes in water demand. This article investigates the determinants of residential water consumption in Chile, a developing country that has seen noteworthy changes in incomes, household size, poverty rates and levels of urbanization, and which is projected to experience significant climatic but varied changes, depending on the region of the country. Panel data for 1998-2010 at the municipal level is used to analyze the sensitivity of residential water demand to climate and development-related factors. In the case of Chile, the effect on water consumption of these development-related changes is estimated to be several times that of the changes associated with climate projections for 50 to 80 years in the future.

Date: 2019
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