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A convergence assessment of water price rates: evidence from major U.S. cities

Author

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  • Panayiotis Tzeremes

    (University of Thessaly)

  • Nickolaos G. Tzeremes

    (University of Thessaly)

Abstract

In this paper we examine whether there is a convergence among residential water price rates for thirty major U.S. cities over the period 2010–2017. By utilizing the methodological framework by Phillips and Sul (Econometrica 75:1771–1855, 2007, J Appl Econom 32:1039–1042, 2009) we test for the existence of convergence clubs among cities’ water pricing policies. We identify the existence of convergence clubs which are based on different consumption markets. The estimated transition paths reveal a tendency of policy makers to increase water price rates over the examined period, which is more pronounced for lower consumption markets.

Suggested Citation

  • Panayiotis Tzeremes & Nickolaos G. Tzeremes, 2018. "A convergence assessment of water price rates: evidence from major U.S. cities," Letters in Spatial and Resource Sciences, Springer, vol. 11(3), pages 361-368, October.
    • Handle: RePEc:spr:lsprsc:v:11:y:2018:i:3:d:10.1007_s12076-018-0218-1
    DOI: 10.1007/s12076-018-0218-1
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    References listed on IDEAS

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    1. Engel, Charles & Rogers, John H, 1996. "How Wide Is the Border?," American Economic Review, American Economic Association, vol. 86(5), pages 1112-1125, December.
    2. Jasper M. Dalhuisen & Raymond J. G. M. Florax & JHenri L. F. de Groot & Peter Nijkamp, 2003. "Price and Income Elasticities of Residential Water Demand: A Meta-Analysis," Land Economics, University of Wisconsin Press, vol. 79(2), pages 292-308.
    3. Stephen G. Cecchetti & Nelson C. Mark & Robert J. Sonora, 2002. "Price Index Convergence Among United States Cities," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 43(4), pages 1081-1099, November.
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    6. Peter C. B. Phillips & Donggyu Sul, 2009. "Economic transition and growth," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 24(7), pages 1153-1185.
    7. Nataraj, Shanthi & Hanemann, W. Michael, 2008. "Does Marginal Price Matter? A Regression Discontinuity Approach to Estimating Water Demand," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt2jc295gr, Department of Agricultural & Resource Economics, UC Berkeley.
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    1. Gil, Jose M. & Montañés, Antonio & Vásquez-González, Bernardo, 2023. "Are prices converging in the global sawnwood market?," Forest Policy and Economics, Elsevier, vol. 155(C).

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    More about this item

    Keywords

    Convergence clubs; Water price rates; U.S. cities;
    All these keywords.

    JEL classification:

    • C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Statistical Simulation Methods: General
    • Q21 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Demand and Supply; Prices

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