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Effectiveness of two pricing structures on urban water use and conservation: a quasi-experimental investigation

Author

Listed:
  • Shyama Ratnasiri

    (Griffith University)

  • Clevo Wilson

    (Queensland University of Technology)

  • Wasantha Athukorala

    (University of Peradeniya)

  • Maria A. Garcia-Valiñas

    (University of Oviedo)

  • Benno Torgler

    (Queensland University of Technology)

  • Robert Gifford

    (University of Victoria)

Abstract

Residential water demand management using price and non-price measures to conserve water has gained considerable international attention from water utilities over the last few decades. The objective of this paper is to explore the effectiveness of different pricing schemes on water conservation. In this study, we compare the ‘conservation-orientedness’ of two pricing schemes. These are a uniform pricing scheme and an increasing block tariff scheme (IBT) structure. A quasi-experimental method is used for this purpose involving 150 suburbs in the Brisbane City Council (BCC) in Queensland, Australia for a 4-year period between 2005 and 2008. Our results show there are more conservation benefits associated with an IBT pricing scheme than a uniform pricing scheme.

Suggested Citation

  • Shyama Ratnasiri & Clevo Wilson & Wasantha Athukorala & Maria A. Garcia-Valiñas & Benno Torgler & Robert Gifford, 2018. "Effectiveness of two pricing structures on urban water use and conservation: a quasi-experimental investigation," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 20(3), pages 547-560, July.
    • Handle: RePEc:spr:envpol:v:20:y:2018:i:3:d:10.1007_s10018-017-0205-6
    DOI: 10.1007/s10018-017-0205-6
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