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Estimating Water Demand under Increasing-Block Tariffs Using Aggregate Data and Proportions of Users per Block

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  • R. Martínez-Espiñeira

Abstract

The price specification suggested by Nordin (1976) for theanalysis of demand under block tariffs is applied to estimatewater demand functions using aggregate data from the Northwest ofSpain. The traditional way of using Nordin's specification whenonly aggregate data are available (using values of marginal priceand difference faced by the average user) is compared with thetheoretically correct one. The latter uses the average marginalprice and the average difference, these averages being weighted bythe proportion of users per block. The availability of data on theproportion of users per block permits also the explicit modellingof the choice of block. The results show that, in the sampleanalyzed, the values of price elasticity under the traditionalspecification and the more innovative one are not significantlydifferent. Copyright Kluwer Academic Publishers 2003

Suggested Citation

  • R. Martínez-Espiñeira, 2003. "Estimating Water Demand under Increasing-Block Tariffs Using Aggregate Data and Proportions of Users per Block," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 26(1), pages 5-23, September.
    • Handle: RePEc:kap:enreec:v:26:y:2003:i:1:p:5-23
    DOI: 10.1023/A:1025693823235
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    5. Bouchrika Ali & Terzi Chokri & Mhadhbi Khalil & El Ammari Anis, 2017. "The Qualitative Model Provides to the Creation of a Hypothetical Water Market in Tunisia," International Journal of Environmental Sciences & Natural Resources, Juniper Publishers Inc., vol. 1(4), pages 96-105, February.
    6. Xayavong, Vilaphonh & Burton, Michael P. & White, Benedict, 2007. "Estimating Urban Residential Water-Demand with Increasing Block Prices: The Case of Perth, Western Australia," Working Papers 7061, University of Western Australia, School of Agricultural and Resource Economics.
    7. David R. Bell & Ronald C. Griffin, 2011. "Urban Water Demand with Periodic Error Correction," Land Economics, University of Wisconsin Press, vol. 87(3), pages 528-544.
    8. René Cabral & Luciano Ayala & Victor Hugo Delgado, 2017. "Residential Water Demand and Price Perception under Increasing Block Rates," Economics Bulletin, AccessEcon, vol. 37(1), pages 508-519.
    9. Andrew C. Worthington, 2010. "Commercial and industrial water demand estimation: Theoretical and methodological guidelines for applied economics research," Discussion Papers in Economics economics:201011, Griffith University, Department of Accounting, Finance and Economics.
    10. Kavezeri-Karuaihe, Selma T. & Wandschneider, Philip R. & Yoder, Jonathan K., 2005. "Perceived Water Prices and Estimated Water Demand in the Residential Sector of Windhoek, Namibia. An Analysis of the Different Water Market Segments," 2005 Annual Meeting, July 6-8, 2005, San Francisco, California 36289, Western Agricultural Economics Association.
    11. DIAKITE Daouda & SEMENOV Aggey & THOMAS Alban, 2006. "Social Pricing and Water Provision in Côte d'Ivoire," LERNA Working Papers 06.14.207, LERNA, University of Toulouse.
    12. Hoffmann, Mark & Worthington, Andrew & Higgs, Helen, 2006. "Urban water demand with fixed volumetric charging in a large municipality: the case of Brisbane, Australia," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 50(3), pages 1-13, September.
    13. Worthington, Andrew C., 2010. "Commercial and Industrial Water Demand Estimation: Theoretical and Methodological Guidelines for Applied Economics Research/Estimación de la demanda de agua comercial e industrial: pautas teóricas y m," Estudios de Economia Aplicada, Estudios de Economia Aplicada, vol. 28, pages 237-258, Agosto.
    14. Konstantin Kogan & Charles Tapiero, 2010. "Water supply and consumption uncertainty: a conflict-equilibrium," Annals of Operations Research, Springer, vol. 181(1), pages 199-217, December.
    15. Guillermo Ignacio Acuña & Cristián Echeverría & Alex Godoy & Felipe Vásquez, 2020. "The role of climate variability in convergence of residential water consumption across Chilean localities," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 22(1), pages 89-108, January.
    16. Mónica Maldonado-Devis & Vicent Almenar-Llongo, 2021. "A Panel Data Estimation of Domestic Water Demand with IRT Tariff Structure: The Case of the City of Valencia (Spain)," Sustainability, MDPI, vol. 13(3), pages 1-26, January.

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