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Water Tariffs and Consumers’ Inaction
In this paper we study the effects of the installation of 500,000 water meters in the South-East of England. Moving from bills based on the characteristics of the house to bills based on actual consumption reduces water usage by more than 15%, with the drop mostly due to people who experience an increase in their water bill due to metering. We also explore customers’ choices in terms of water tariffs, uncovering evidence of a strong status quo bias.
Mirco Tonin is Professor of Economic Policy at the Faculty of Economics and Management, University of Bozen-Bolzano. He is also a research fellow at IZA and at the Dondena Centre for Research on Social Dynamics and Public Policy (Welfare State and Taxation Unit) at Bocconi University, and a research affiliate at CESifo. He received his Ph.D. In Economics from Stockholm University in 2007. His main research interests are in labour economics, public finance and behavioural economics.
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