Abstract

GOMEZ-UGALDE, Sandra Gabriela; MORA-FLORES, José Saturnino; GARCIA-SALAZAR, José Alberto  and  VALDIVIA-ALCALA, Ramón. Residencial and commercial water demand. Terra Latinoam [online]. 2012, vol.30, n.4, pp.337-342. ISSN 2395-8030.

Water scarcity and overextraction of aquifers is an environmental and economic problem affecting the population of Texcoco, State of Mexico. To quantify the demand for water in households and commercial sectors and the variables determining overextraction of the Texcoco aquifer, two econometric models of multiple linear regression were designed to quantify water demand and determine whether the water price policy is adequate for administration and for encouraging more efficient use. The results show that water demand responds inelastically to water price or tariff in the household sector, with an elasticity coefficient of -0.43, and elastically in the commercial sector with a coefficient of -1.03. This indicates that a price policy can be effective to promote saving water only for the commercial sector. Income elasticity for households indicates that water is a normal good, with an elasticity of 0.40 at its midpoint. In the commercial sector, with an income elasticity of 1.22, the water is superior good. The results suggest that access to water in this sector is directly influenced by income since commercial enterprises with higher incomes have more opportunities to access the resource. Analogically, electricity is a complementary good in water consumption, with elasticity of -0.0055 and -0.25 for households and commercial use, respectively. Thus, this variable has lesser influence on water demand in Texcoco, particularly in the household sector.

Keywords : water policies; elasticities; overextraction.

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