Commercial and industrial water demand estimation: Theoretical and methodological guidelines for applied economics research

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Worthington, Andrew
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2010
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Abstract

Unlike the modelling of residential water demand, very little recent empirical work has concerned the estimation of commercial and industrial water demand. This is an important omission, not only because these activities are subject to the same water-related challenges found elsewhere, including the need for a reliable water supply, rising water prices and seasonal water scarcity, but because they also account for substantial water use as a key input into productive activities and hence employment and value-added. Moreover, commercial and industrial water demand and its management are inherently complex, involving among other things the potential for recycling, the impact of discharge regulations, the possibilities of substituting for other inputs and the potential for self-supply, and the role of large scale workplace practices and technology. As a means of redressing this imbalance, this paper provides a discussion of the theory and practice of commercial and industrial water demand estimation. Both model specification and estimation and the outcomes of past analyses are discussed. Particular focus is placed on providing useful guidance to future researchers in this important area.

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Estudios de Economía Aplicada
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28
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2
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Environment and Resource Economics
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