A Panel Data Estimation of Domestic Water Demand with IRT Tariff Structure: The Case of the City of Valencia (Spain)
| Autor: | Mónica Maldonado-Devis, Vicent Almenar-Llongo |
|---|---|
| Jazyk: | angličtina |
| Rok vydání: | 2021 |
| Předmět: |
urban water consumption
water pricing urban areas intraurban analysis unobserved heterogeneity micro database 0208 environmental biotechnology Geography Planning and Development TJ807-830 Tariff 02 engineering and technology 010501 environmental sciences Management Monitoring Policy and Law TD194-195 01 natural sciences Renewable energy sources Demand curve Econometrics Economics GE1-350 0105 earth and related environmental sciences Price elasticity of demand Environmental effects of industries and plants Renewable Energy Sustainability and the Environment Fixed effects model Water pricing 020801 environmental engineering Environmental sciences Econometric model Microdata (HTML) Panel data |
| Zdroj: | Sustainability; Volume 13; Issue 3; Pages: 1414 Sustainability, Vol 13, Iss 1414, p 1414 (2021) |
| ISSN: | 2071-1050 |
| DOI: | 10.3390/su13031414 |
| Popis: | In urban water provisioning, prices can improve efficiency, contributing to the achievement of the environmental objective. However, household responses to price changes differ widely based on the household characteristics. Analyses performed at the aggregate level ignore the implications of water demand incentives at the individual household level. A large data sample at the household level enables estimation of econometric models of water demand, capturing the heterogeneity in domestic consumption. This study estimated the domestic water demand in the city of Valencia and its elasticity, along with the demands of its different districts and neighbourhoods (intra-urban scale analysis). Water price structure in Valencia is completely different from that of other Spanish cities: it is a price structure of increasing volume (increasing rate tariffs, IRT). For this estimation, from a microdata panel at the household level, the demand function with average prices for the period 2008–2011 was estimated using panel data techniques including a fixed effect for each neighbourhood. The domestic water demand elasticity at the average price in Valencia was estimated at −0.88 (which is higher than that estimated for other Spanish cities). This value indicates an inelastic demand at the average price of the previous period, which can cause consumers to overestimate the price and react more strongly to changes. |
| Databáze: | OpenAIRE |
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