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Price Rationing

  • Donald E. Agthe
  • R. Bruce Billings
Chapter
Part of the Water Science and Technology Library book series (WSTL, volume 46)

Abstract

A scarce good can only be obtained by giving up something else or by paying a positive price for it. In most urban areas, water is a scarce good and is therefore subject to the laws and principles of economics. In particular, the quantity of water taken from the market by any given buyer or group of buyers is influenced by the price that must be paid. The price of water, in its most general sense, includes not only monetary payments, but the time and energy expended to obtain that water. For example, if a person must drive or walk some distance to buy water, the price includes the value of time spent as well as the monetary payment. As urban water becomes increasingly scarce, price can be used to allocate its use efficiently among its many competing end uses. Prices can also be used to encourage the meeting of community social goals with regard to the availability and use of water.

Keywords

Marginal Cost Demand Curve Urban Water Supply Curve Urban Water Supply 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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References

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Suggestions for Additional Reading

  1. Agthe, D.E., and R.B. Billings, 1987. “Equity, Price Elasticity and Household Income Under Increasing Block Rates for Water,” American Journal of Economics and Sociology, 46 (3):201–212.CrossRefGoogle Scholar
  2. Billings, R.B., and D.E. Agthe, 1980. “Price Elasticities for Water: A Case of Increasing Block Rates,” Land Economics, 56(l):73–84.CrossRefGoogle Scholar
  3. Billings, R.B. and C.V. Jones, 1996. Chapter 9, Forecasting Urban Water Demand, American Water Works, Association, Denver, Colorado.Google Scholar
  4. Foster, H., and B. Beattie, 1979. “Urban Residential Demand for Water in the United States,” Land Economics, 55(l):43–58.CrossRefGoogle Scholar
  5. Haddad, B.M., Rivers of Gold: Designing Markets to Allocate Water in California, Island Press, Washington, D.C.Google Scholar
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  7. Mansfield, E., 1994, Applied Microeconomics 2nd. Edition, W.W. Norton and Company, New York, New York.Google Scholar
  8. Martin, W.E., and J.F. Thomas, 1986. “Policy Relevance in Studies of Urban Residential Water Demand,” Water Resources Research, 22(13):1735–1741.CrossRefGoogle Scholar
  9. Neufeld, J.L., and J.M. Watts, 1981. “Inverted Block or Lifeline Rates and Microefficiency in the Consumption of Electricity,” Energy Economics, 3 (2):113–121.CrossRefGoogle Scholar
  10. Stigler, G., 1966. The Theory of Price, The MacMillan Company, New York.Google Scholar

Copyright information

© Springer Science+Business Media Dordrecht 2003

Authors and Affiliations

  • Donald E. Agthe
  • R. Bruce Billings
    • 1
  1. 1.University of ArizonaUSA

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