The determinants of residential water demand: empirical evidence for a panel of Italian municipalities

Massimiliano Mazzanti, Anna Montini
2006 Applied Economics Letters  
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more » ... bedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Summary We present empirical evidence on the determinants of residential water demand for one Italian region, Emilia-Romagna, by using municipal panel data. The estimated water demand price elasticity is negative, showing values between -0.99 and -1.33, never significantly different from one, considering different specifications without and with additional socio-economic factors. Income results associated to a positive elasticity, though lower than one. The role of other socio-economic territory-specific determinants is less relevant, with the exception of altitude. The relative high value of price elasticity is deemed consistent with the higher level of Regional water prices compared to the national average. The applied analysis is an important starting point for the Italian environment, which lacks reliable estimates on elasticities concerning microeconomic water demand studies. The estimation of price elasticity and the investigation on the determinants of water demand are necessary steps for both private and private-public management of water resources within the new framework originating from the implementation of the 96/1994 National water bill. JEL Classification: C23, D12, Q25 This work stems from an ongoing 2-years National Research project funded by MIUR and CNR (GENESTO project), concerning water demand, water infrastructures and water policies. The Institute CERIS/DSE-CNR of Milan is responsible for the socioeconomic section of the project. We acknowledge the support of those water utilities that provided data.
doi:10.1080/13504850500390788 fatcat:4rlkpjp23vfuvhvuvmmrk6bwn4