Conservation Policies: Who Responds to Price and Who Responds to Prescription?
Casey Wichman (),
Laura Taylor () and
Roger von Haefen
No 20466, NBER Working Papers from National Bureau of Economic Research, Inc
The efficiency properties of price and non-price instruments for conservation in environmental policy are well understood. Yet, there is little evidence comparing the effectiveness of these instruments, especially when considering water resource management. We exploit a rich panel of residential water consumption to examine heterogeneous responses to both price and non-price conservation policies during times of drought while controlling for unobservable household characteristics. Our empirical models suggest that the burden of pricing policies fall disproportionately on low-income households and fail to reduce consumption among households who generally are large consumers of water. However, prescriptive policies such as restrictions on outdoor water use result in uniform responses across income classes while simultaneously targeting reductions from households with irrigation systems or historically high consumption.
JEL-codes: D12 H42 L51 L95 Q25 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-agr and nep-env
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Published as Wichman, Casey J. & Taylor, Laura O. & von Haefen, Roger H., 2016. "Conservation policies: Who responds to price and who responds to prescription?," Journal of Environmental Economics and Management, Elsevier, vol. 79(C), pages 114-134.
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Working Paper: Conservation Policies: Who Responds to Price and Who Responds to Prescription? (2016)
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