SERP-P: Socioeconomic Research Portal for the Philippines

Due to the rapid population growth in cities and the rising cost of developing new sources of water supply, Metro Cebu has experienced an increasing demand and supply gap. This has been exacerbated by the current drought and the pollution on bodies of water surrounding the city. Efficient water utilization entails the adoption of an optimal pricing framework to mitigate the externalities imposed by production and consumption of water. This study examines the nature and determinants of water demand in the Metro Cebu households. Estimates show that optimal pricing strategy can be an effective means of addressing the scarcity of freshwater supply. The relatively high water prices reflect the cost of distribution and monopoly profits, both of which can be reduced through expanding and making accessible the central distribution system.

Citations

This publication has been cited 5 time(s).

Israel, Danilo C, 2013 "An assessment of the local service delivery of potable water in Dumaguete City and selected areas of Agusan del Sur Province" , Philippine Institute for Development Studies
Israel, Danilo C., 2009 "Local service delivery of potable water in the Philippines: National review and case analysis" , Philippine Institute for Development Studies
Kia, Amir, 2002 "Interest free and interest-bearing money demand: Policy invariance and stability" , Economic Research Forum
Monteiro, Henrique, 2010 "Residential water demand in Portugal: Checking for efficiency-based justifications for increasing block tariffs" , ISCTE-IUL, Business Research Unit (BRU-IUL)
World Bank, 2006 "Republic of Colombia" , The World Bank Group

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Contributor

Philippine Institute for Development Studies

Authors

David, Cristina C. Inocencio, Arlene B. Largo, Francisco M.

Keywords

water sector; pricing strategy; water demand

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Jul 06, 2013

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