Abstract
Static, Fisher‐Kaysen, Koyck, flow adjustment (Bergstrom), and stock adjustment econometric models of the demand for residential water are tested for their ability to explain the monthly residential demand for water in Tucson. Marginal price and a second price‐related variable are used in the estimating equations to account for block rates and fixed charges in the water rate schedule. The other independent vari ables are household income and evapotranspiration minus rainfall. The Fisher‐Kaysen model produced very poor statistical results. The estimated long‐run marginal price elasticities of demand varied from −0.266 to −0.705. The short‐run marginal price elasticity estimates varied from −0.179 to −0.358 except for the linear flow adjustment model with a value of −2.226. This unexpected result casts some doubt on the applicability of the flow adjustment model to estimating the price elasticity of demand with monthly data.
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