Free to Choose: Promoting Conservation by Relaxing Outdoor Watering Restrictions

38 Pages Posted: 4 Aug 2014 Last revised: 20 Feb 2022

See all articles by Anita Castledine

Anita Castledine

Public Utilities Council of Nevada

Klaus Moeltner

University of Nevada - Department of Resource Economics

Michael Price

Georgia State University - Department of Economics

Shawn Stoddard

Truckee Meadows Water Authority

Date Written: July 2014

Abstract

Many water utilities use outdoor watering restrictions based on assigned weekly watering days to promote conservation and delay costly capacity expansions. We find that such policies can lead to unintended consequences - customers who adhere to the prescribed schedule use more water than those following a more flexible irrigation pattern. For our application to residential watering in a high-desert environment, this "rigidity penalty" is robust to an exogenous policy change that allowed an additional watering day per week. Our findings contribute to the growing literature on leakage effects of regulatory policies. In our case inefficiencies arise as policies limit the extent to which agents can temporally re-allocate actions.

Suggested Citation

Castledine, Anita and Moeltner, Klaus and Price, Michael and Stoddard, Shawn, Free to Choose: Promoting Conservation by Relaxing Outdoor Watering Restrictions (July 2014). NBER Working Paper No. w20362, Available at SSRN: https://ssrn.com/abstract=2475749

Anita Castledine (Contact Author)

Public Utilities Council of Nevada ( email )

1150 East Williams Street
Carson City, NV 89701
United States

Klaus Moeltner

University of Nevada - Department of Resource Economics ( email )

1664 N. Virginia Street
Reno, NV 89557
United States
(775) 784-4803 (Phone)
(775) 784-1342 (Fax)

Michael Price

Georgia State University - Department of Economics ( email )

P.O. Box 3992
Atlanta, GA 30302-3992
United States

Shawn Stoddard

Truckee Meadows Water Authority ( email )

1355 Capital Boulevard
Reno, NV 89502
United States

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