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Water Tariff Increase In Manaus (Brazil): An Evaluation Of The Impact On Households

Author

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  • Anne Olivier

    (DIAL, EHESS)

Abstract

(english) Increasing block tariffs seek a cross-subsidy mechanism between the water network users, based on the common assumption of weak water price elasticity. In Manaus, the capital city of the Brazilian state of Amazonas where most of the 1.6 million dwellers are supplied through the municipal water network, a substantial consumption drop followed the tariff increase of 2004. This drop questions the cross-subsidy capacity of the current structure. We see this 31.51% tariff increase as a natural experiment applied to the whole network user population of Manaus and this allows us to measure the impact on monthly consumption of metered households, using month per month differences between years 2003 and 2004. _________________________________ (français) Les structures tarifaires progressives par tranche de consommation en eau cherchent à établir des péréquations entre les usagers du réseau d’approvisionnement, ceci sous l’hypothèse d’élasticités faibles au prix de l’eau. A Manaus, capitale de l’Etat d’Amazonas au Brésil où résident 1,6 million de personnes majoritairement approvisionnées par le réseau municipal, la dernière hausse du prix de l’eau, appliquée uniformément à chaque tranche de consommation en janvier 2004, a conduit à une baisse significative des consommations, remettant en cause la capacité de subventions croisées de la structure tarifaire. L’exploitation de cette hausse de 31,51 % du tarif, comme un choc naturel subi par l’ensemble des usagers du réseau d’approvisionnement de Manaus, permet d’en mesurer l’impact sur les consommations mensuelles en eau des ménages équipés de compteurs par différence mois à mois entre les années 2004 et 2003.

Suggested Citation

  • Anne Olivier, 2006. "Water Tariff Increase In Manaus (Brazil): An Evaluation Of The Impact On Households," Working Papers DT/2006/10, DIAL (Développement, Institutions et Mondialisation).
  • Handle: RePEc:dia:wpaper:dt200610
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    Citations

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    Cited by:

    1. Auriol, Emmanuelle & Blanc, Aymeric, 2009. "Capture and corruption in public utilities: The cases of water and electricity in Sub-Saharan Africa," Utilities Policy, Elsevier, vol. 17(2), pages 203-216, June.
    2. Suratin Aloysius & Triakuntini Eka & Herdiansyah Herdis, 2019. "Effects of the implementation of a progressive tariffs policy on water management in DKI Jakarta, Indonesia," Environmental & Socio-economic Studies, Sciendo, vol. 7(4), pages 36-44, December.
    3. Kresch, Evan Plous & Walker, Mark & Best, Michael Carlos & Gerard, François & Naritomi, Joana, 2023. "Sanitation and property tax compliance: Analyzing the social contract in Brazil," Journal of Development Economics, Elsevier, vol. 160(C).
    4. Lin, Boqiang & Jiang, Zhujun, 2012. "Designation and influence of household increasing block electricity tariffs in China," Energy Policy, Elsevier, vol. 42(C), pages 164-173.
    5. Ramón Barberán & Fernando Arbués, 2009. "Equity in Domestic Water Rates Design," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 23(10), pages 2101-2118, August.

    More about this item

    Keywords

    Water Demand; Tariff; Price-elasticity; Impact Evaluation; Natural Experiment; Brazil; Demande en Eau; Tarif; Élasticité-Prix; Evaluation d’impact; Expérience naturelle; Brésil.;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • Q21 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Demand and Supply; Prices
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water

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