Urban water demand for industrial uses in Spain

ABSTRACT

This study estimates the demand for urban water in Spanish industry, with particular attention to differences between sectors. A panel dataset for the Spanish Autonomous Communities in the period 1993–2013, broken down into 11 sectors, was used. The results indicate that water pricing policy can be used effectively as a mechanism to encourage reduced water use (elasticity of ?0.66), but there is a strong sectoral heterogeneity that recommends the additional use of other types of instruments. In general, sectors where water represents a larger proportion of total costs present greater elasticity.