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Environmental Economics and Policy Studies

, Volume 20, Issue 3, pp 547–560 | Cite as

Effectiveness of two pricing structures on urban water use and conservation: a quasi-experimental investigation

  • Shyama Ratnasiri
  • Clevo Wilson
  • Wasantha Athukorala
  • Maria A. Garcia-Valiñas
  • Benno Torgler
  • Robert Gifford
Research Article
  • 106 Downloads

Abstract

Residential water demand management using price and non-price measures to conserve water has gained considerable international attention from water utilities over the last few decades. The objective of this paper is to explore the effectiveness of different pricing schemes on water conservation. In this study, we compare the ‘conservation-orientedness’ of two pricing schemes. These are a uniform pricing scheme and an increasing block tariff scheme (IBT) structure. A quasi-experimental method is used for this purpose involving 150 suburbs in the Brisbane City Council (BCC) in Queensland, Australia for a 4-year period between 2005 and 2008. Our results show there are more conservation benefits associated with an IBT pricing scheme than a uniform pricing scheme.

Keywords

Demand for residential water Increasing block rates Conservation Quasi-experiment Pricing schemes Efficiency Australia 

Notes

Acknowledgements

The authors would like to thank Australian Research Council (ARC) for financial support (Grant number DP0988254).

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Copyright information

© Society for Environmental Economics and Policy Studies and Springer Japan KK, part of Springer Nature 2017

Authors and Affiliations

  • Shyama Ratnasiri
    • 1
  • Clevo Wilson
    • 2
  • Wasantha Athukorala
    • 3
  • Maria A. Garcia-Valiñas
    • 4
  • Benno Torgler
    • 2
  • Robert Gifford
    • 5
  1. 1.Department of Accounting, Finance and EconomicsGriffith UniversityGold CoastAustralia
  2. 2.School of Economics and FinanceQueensland University of TechnologyBrisbaneAustralia
  3. 3.Department of Economics and StatisticsUniversity of PeradeniyaPeradeniyaSri Lanka
  4. 4.Oviedo Efficiency Group, Department of EconomicsUniversity of OviedoOviedoSpain
  5. 5.Department of PsychologyUniversity of VictoriaVictoriaCanada

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