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An empirical examination of the distributional impacts of water pricing reforms

Steven Renzetti, Diane Dupont () and Tina Chitsinde

Utilities Policy, 2015, vol. 34, issue C, 63-69

Abstract: Water pricing reforms may promote conservation and economic efficiency. However, it is possible for water pricing reforms to be regressive. We estimate Stone-Geary and double-log residential water demand functions using data from the Capital Region District of British Columbia, Canada. Two price reforms are simulated: an across-the-board price increase and an increasing block rate structure. The distributional impacts depend on the specification of water demands. For the across-the-board price increase, the double-log model shows no change in the distribution of water expenditures while the Stone-Geary specification indicates a worsening of the inequality of water expenditures.

Keywords: Pricing; Demand; Equity (search for similar items in EconPapers)
Date: 2015
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DOI: 10.1016/j.jup.2014.12.004

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Handle: RePEc:eee:juipol:v:34:y:2015:i:c:p:63-69