Water JPI Joint Call (Step2) - 2018 Joint Call: Closing the Water Cycle Gap - Sustainable Management of Water Resources (Step2)

Nudges for Economics of Water Tariffs – NEWTS

Submission summary

The project aims to provide a socio-economic assessment of green nudging policies, focusing on water consumption controlling and/or proper understanding by the households of the charging system, taking into account adjustments in pricing policy that nudges, by their effects on water demand functions, may generate. From an operational point of view, it consists in developing a microsimulation model, based on econometric estimates of household water demand, to assess socio-economic returns of mix policies, combining nudges and pricing instruments, and identify financially sustainable DSM policies that improve existing pricing of water.

The effects of nudges on household water consumptions are examined through the realization of controlled experiments, in laboratory and in the field. Controlled field experiments are deployed on a large scale in Gijon (Spain), Saint Paul (Reunion Island - France) and Sfax (Tunisia). Econometric estimation of residential water demand is carried out to measure basic needs of the households, price-sensitivity of demand and perceived prices of water, and to infer the effects of behavioural interventions on these factors. Using a broad set of appropriate indicators to measure affordability, incentive efficiency and distributional effects, cost-benefit analysis are conducted to infer the effects of nudges on the socio-economic performance of the existing pricing system (that may be improved) and propose optimal policies, according to well-defined decision criteria for local public decision-makers, in various frameworks. These methodologies articulate to construct a decision support model that will be posted on line, with an evaluation software package on a web platform.

Project coordination

Michel Paul (Centre d'Economie et de Management de l'Océan Indien)

The author of this summary is the project coordinator, who is responsible for the content of this summary. The ANR declines any responsibility as for its contents.


EPRU Economics Policy Research Unit
GAEL Laboratoire d'Economie Appliquée de Grenoble
CREM Centre de Recherche en Economie et Management
LAREQUAD Laboratory for Research in Quantitative Development Economics
OEG University of Oviedo - Oviedo Efficiency Group
GRANEM Groupe de Recherche Angevin en Economie et Management
CEMOI Centre d'Economie et de Management de l'Océan Indien

Help of the ANR 295,904 euros
Beginning and duration of the scientific project: April 2019 - 36 Months

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