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Monteiro, H., Rita Martins, Ramalho, J.J.S. & Ramalho, E.A. (2018). Are ill-informed residential water consumers less price-responsive?. 6th World Congress of Environmental and Resource Economists.

H. P. Monteiro et al.,  "Are ill-informed residential water consumers less price-responsive?", in 6th World Congr. of Environmental and Resource Economists, Gotemburgo, 2018

@misc{monteiro2018_1734833832757,
	author = "Monteiro, H. and Rita Martins and Ramalho, J.J.S. and Ramalho, E.A.",
	title = "Are ill-informed residential water consumers less price-responsive?",
	year = "2018",
	howpublished = "Digital",
	url = "http://www.wcere2018.org/"
}

TY  - CPAPER
TI  - Are ill-informed residential water consumers less price-responsive?
T2  - 6th World Congress of Environmental and Resource Economists
AU  - Monteiro, H.
AU  - Rita Martins
AU  - Ramalho, J.J.S.
AU  - Ramalho, E.A.
PY  - 2018
CY  - Gotemburgo
UR  - http://www.wcere2018.org/
AB  - The vast literature estimating residential water demand assumes households are aware of and respond to changes in the tariffs or at least in the average price paid. However, in a framework where consumers face complex tariff schemes, and water bills tend to represent a reduced household expenditure, this awareness cannot be taken by granted. In this paper, we estimate a discrete continuous choice (DCC) model of residential water demand in Portugal that allows price elasticities to change as a function of consumers’ perception of their water bills. A control function approach is added to the DCC model to deal with the potential endogeneity of the perception indicator. We find water demand to be price-inelastic, but less so if consumers’ awareness about the amount they pay is higher. We also provide novel findings on the impact of environmentally-friendly behaviors, rainwater harvesting and availability of alternative water sources.
ER  -