Does Anybody Give a Dam? The Importance of Public Awareness for Urban Water Conservation During Drought
EERH Research Report No. 100
35 Pages Posted: 9 Aug 2011 Last revised: 4 Jul 2013
Date Written: March 1, 2011
Demand management has been of interest in dry climates such as Australia, Spain and the Western United States for decades. It is particularly important to understand policy options during drought conditions, as drought periods have a disproportionate effect on supply infrastructure decisions. While water‐conservation campaigns aimed at inducing voluntary consumption reductions are almost universally employed by water managers in times of supply constraint, voluntary measures are generally dismissed in the economics literature as ineffective. We argue that the robust positive correlation between dam levels and consumption after controlling for policy changes suggests that there is a significant component of voluntary conservation. Furthermore, omitting dam levels from regressions may bias estimated impacts of policy changes.
Keywords: water use, demand management, pricing, behavioral aspects
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