Estimating Residential Water Demand Under Systematic Shifts Between Uniform Price (UP) and Increasing Block Tariffs (IBT)
A. M. Chovar Vera,
F. A. Vásquez‐Lavín,
R. Ponce Oliva
Abstract:We evaluate whether changing from a uniform price (UP) to an increasing block tariff (IBT) changes people's behavior. We exploit a unique setting in which the price scheme moves back and forth yearly from UP to IBT. We discuss the effectiveness of IBT in reducing summer consumption. This issue is relevant to many countries and policymakers interested in designing tariff structures. There is no evidence of how the same consumer may react to systematically switching from one tariff structure to another yearly. W… Show more
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