|FAO Irrigation and Drainage Paper 52 Reforming water resources policy A guide to methods, processes and practices (1995)|
|Chapter 3 - Principles|
Water is a sensitive topic in most societies. Reforming public behaviour towards water is an invidious and difficult task, with substantial political and administrative costs. It is therefore important that policies should have a commensurate 'pay-off in the effective fulfilment of their goals. Efficacy is thus related to the criterion of acceptability, discussed below.
In the case of increases in the price of water, the clearest measure of response is the elasticity of demand in respect of changes in its price. There is growing evidence that certain categories of demand are elastic enough, in this sense, for price changes to induce demand responses. Even where demand is price-inelastic (where the amount consumed changes less than proportionately to the price increase), prices can still be successful in reducing consumption, compared to other options for balancing supply and demand.
In many instances, a combination of measures might be most effective. Higher charges for water use might be accompanied by a campaign of public information and education, subsidies for the installation of water-efficient facilities, and free advice on reducing consumption and waste. The effective control of water pollution could entail the combination of regulations ('command and control' devices) - properly enforced - with 'polluter pays' taxes and charges.