AWATER PRICING STRATEGIES AS AN ECONOMIC TOOL TOWARDS WATER SECURITY

Document Type : Review Article

Authors

1 Faculty of Commerce, Ain Shams University

2 Strateic Research Unit (SRU), National Water Research Center, Ministry of Water Resources and Irrigation, Egypt

3 Egyptian Public Authority for Drainage Projects

Abstract

Scarcity, value in use, and easiness of access; among others; determine the economic value of goods as well as the willingness to pay for these goods. Although, water is not an exemption, it is a life sustaining good for all living creatures and an input for almost all products. Thus, the application of economic tools in dealing with the provision of water should be controlled by consideration the very special nature of water.
On one hand, water pricing presents one of the economic tools to promote the efficient use of water, and to supply necessary funds to develop water infrastructure. Nonetheless, if they are not wisely formulated, they may jeopardise the society’s socio-economic-political wellbeing.
On the other hand, inherited social and economic rights over decades allowing people to get water for low unrealistic charges or even for free represents a main obstacle confronting the implementation of any pricing strategy.
Following the analytical descriptive method, secondary data associated with the applied pricing methods were obtained from published reports to allow the assessment and analysis of such data to realize the most applicable water pricing strategy.
Nonetheless, and due to lack of a standardized methodology to price water in different usages internationally. Water pricing should be based on a policy coherence that mainly takes into consideration the socio-economic security goals of the society and considers the interaction, prioritization and overlap between these goals in order to minimize trade-offs.

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Journal of Environmental Science
Volume 39, Issue 3
September 2017
Pages 75-102

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