Current Issues in the Economics of Water Resource Management - Theory, Applications and Policies (Paperback, Softcover reprint of hardcover 1st ed. 2002)

The marginal price elasticities estimated by Martinez-Espineira conforms to expectation. The price specification that accounts for the changing proportion of water users in each block yields a higher elasticity (-0. 47) compared to the spec ification ignoring this feature of the data. However, this difference is not found to be statistically significant, a result attributed to the low power of the test (small sample size limiting the accuracy of estimates). In conclusion, the paper provides a theoretically correct price specification for demand functions under block pricing and aggregate data. The empirical findings in the paper, however, are not conclusive and further empirical work using more data and alternative (nonlinear) demand functions, is needed to show the practical implications of the arguments put forward by the Martinez-Espineira's paper. Static empirical consumer demand functions estimated with aggregate data are well known to suffer form serial correlation and other statistical problems asso ciated with misspecified dynamics. These dynamics arise because consumers do not react immediately to a change in prices due to their largely predetermined lifestyle. In the case of demand for water, for example, current purchases can be largely predetermined due to commitments arising from past purchases such as swimming pools, bathtubs, dishwashing machines, etc. Muellbauer and Pashardes (1992) show that the autoregressive nature of consumer demand data can be cap tured in a theoretically consistent manner by incorporating intertemporal aspects of consumer behaviour in the model through habit formation and durability."

General

Imprint:	Springer
Country of origin:	Netherlands
Series:	Economy & Environment, 23
Release date:	December 2010
First published:	2002
Editors:	P. Pashardes • T. M. Swanson • A. Xepapadeas
Dimensions:	235 x 155 x 13mm (L x W x T)
Format:	Paperback
Pages:	234
Edition:	Softcover reprint of hardcover 1st ed. 2002
ISBN-13:	978-90-481-5986-4
Categories:	Books > Law > Laws of other jurisdictions & general law > Social law > Environment law Books > Earth & environment > Earth sciences > The hydrosphere > General Books > Earth & environment > The environment > Environmental economics > General
LSN:	90-481-5986-5
Barcode:	9789048159864

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