Estimation of Residential Water Demand with Imperfect Price Perception

Marie-Estelle Binet (), Fabrizio Carlevaro and Michel Paul ()
Additional contact information
Fabrizio Carlevaro: Département d'économétrie et Centre universitaire d'étude des problèmes de l'énergie - UNIGE - Université de Genève = University of Geneva
Michel Paul: CEMOI - Centre d'Économie et de Management de l'Océan Indien - UR - Université de La Réunion

Post-Print from HAL

Abstract: Using data from a household survey carried out in the French overseas territory of Réunion, we investigate the price of drinking-water perceived by households faced with an increasing, multi-step pricing scheme. To this purpose we use an improved version of the method introduced by Shin (1985) to estimate the demand for residential water when consumers are imperfectly informed about their pricing schedule. The empirical results suggest that Réunion households underestimate the price of water and thus consume more than what is economically rational. Providing information to households about the marginal price of water may be an innovative means of inducing them to respond to pricing policies designed to promote water conservation.

Keywords: residential water demand; price information policies; price perception; non nested models; increasing block tariffs; Artificial nesting; residential water demand. (search for similar items in EconPapers)
Date: 2014-12
New Economics Papers: this item is included in nep-agr
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00918147
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (19)

Published in Environmental and Resource Economics, 2014, 59 (4), pp.561-581. ⟨10.1007/s10640-013-9750-z⟩

Downloads: (external link)
https://shs.hal.science/halshs-00918147/document (application/pdf)

Related works:
Journal Article: Estimation of Residential Water Demand with Imperfect Price Perception (2014)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00918147

DOI: 10.1007/s10640-013-9750-z

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().