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The Role of Pricing in Sustainable Urban Water Management

Author(s): Karen Kviberg Creagh

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Keywords: Ttitudinal determinants; Ecosystem services; Sustainable development; Transdisciplinary research; Urban water; Willingness to pay

Abstract: Sustainable management of urban water relies on our ability to integrate knowledge from social, ecological and economic disciplines, and our capacity to examine the functioning of the system as a whole. A transdisciplinary framework for urban water management was constructed to assess the role of water charges in sustainable urban water management. In particular, the framework considers: 1) the role of pricing in infrastructure and asset investment; 2) the role of pricing in consumption and 3) the willingness to pay for environmental goods and services in the urban water catchment. These functions of water charges were explored using a survey of households in two major New Zealand cities. Auckland City and Christchurch City represent opposing endpoints on a continuum of charging policies, access to information for consumers, water availability and resource “identification, ownership and pride” currently employed by the water industry in New Zealand. The research identifies economically efficient ecological benefits from technological fixes and consumer barriers to the uptake of the same; identifies the existence of a consumer surplus; and finally quantifies the willingness to pay for environmental goods and services depending on certain attitudinal differences in the two communities. The paper concludes that knowledge of attitudinal determinants of willingness to pay empower local water managers to remove barriers to sustainable technologies uptake which subsequently allows asset investment to be ecologically as well as economically efficient.

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Year: 2010

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