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Econometrics Informing Natural Resources Management

Selected Empirical Analyses

Edited by Phoebe Koundouri

This fascinating book outlines the fundamental principles and difficulties that characterise the challenging task of using econometrics to inform natural resource management policies, and illustrates them through a number of case studies from all over the world. The book offers a comprehensive overview of the broader picture of the state-of-the-art in econometrics as applied to environmental and natural resource management.
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Chapter 4: Residential water demand in the Slovak Republic

Laurent Dalmas and Arnaud Reynaud


Laurent Dalmas and Arnaud Reynaud 1. INTRODUCTION Water resource management requires a reasonable knowledge of water uses. Among the different types of water uses, residential water demand constitutes an essential ingredient in the design of a pricing policy for a water network. This may be why during the last decades numerous studies have been devoted to the estimation of residential water demand functions. Most of them are based on North American data and empirical evidence is still very scarce for European countries. Dalhuisen et al. (2003) have produced a meta-analysis on the variations in price and in income elasticities for residential water demand. Among the 51 articles published in scientific reviews and used by these authors, only ten provide estimates for a European country and none of them deals with Central or Eastern European Countries (CEEC). The lack of data due to the revision of statistical standards since the beginning of the transition process in most of the CEEC is the most likely explanation. This chapter aims at filling this gap by analysing residential water demand in the Slovak Republic. The Slovak Republic is preparing to join the European Union (EU) in May 2004. One of the basic requirements of accession negotiations for the Slovak Republic was to increase the level of care for the environment so as to comply with EU environmental standards and especially with the EU Water Framework Directive (WFD). Implementation of the WFD in particular will lead the CEEC to review their water pricing...

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