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Open AccessArticle

Hotel Water Demand: The Impact of Changing from Linear to Increasing Block Rates

1
Department of Business Economics, University of the Balearic Islands, 07122 Palma, Spain
2
Department of Geography, University of the Balearic Islands, 07122 Palma, Spain
3
Department of Applied Economics, University of the Balearic Islands, 07122 Palma, Spain
*
Author to whom correspondence should be addressed.
Water 2019, 11(8), 1604; https://doi.org/10.3390/w11081604
Received: 20 May 2019 / Revised: 22 July 2019 / Accepted: 31 July 2019 / Published: 2 August 2019
(This article belongs to the Collection Water Policy Collection)
Water is a key aspect for any tourist destination. The pressure of tourism on water resources, and specifically by the hotel sector on islands and coastal areas, threatens the sustainability of the resource and, ultimately, of the destination. Several international organizations propose price policy as an instrument to promote efficiency and penalize excessive water consumption. This study analyzes the short-term effectiveness of a water tariff reform, implemented by the regional government of the Balearic Islands in 2013, on hotel water consumption. The change consists in moving from a linear to an increasing block rate system. The study applies quantile regression with within-artificial blocks transformation on panel data for the period 2011–2015. The results conclude that the reform was not effective as a means to reduce the levels of water consumption. The disproportionate fixed component of the water tariff and the oversized initial block of the sanitation fee can explain the ineffectiveness of the reform. View Full-Text
Keywords: water price reform; hotel water consumption; tourism sustainability; Mallorca; increasing block rates water price reform; hotel water consumption; tourism sustainability; Mallorca; increasing block rates
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MDPI and ACS Style

Deyà-Tortella, B.; Garcia, C.; Nilsson, W.; Tirado, D. Hotel Water Demand: The Impact of Changing from Linear to Increasing Block Rates. Water 2019, 11, 1604.

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