Price elasticity of household water demand in the Czech Republic

In the Czech Republic, water prices have been steadily increasing while water consumption has been decreasing during the last decades. A great deal of literature is devoted to the price elasticity of water demand but to the best of our knowledge, no similar study has been devoted entirely to the Czech Republic. In the paper, we examine the short and long-run price elasticities of water demand in the Czech Republic between years 2000 and 2011. We find that the water demand is inelastic (lower than one) with respect to water price regardless of the time period and the income elasticity is on the edge of statistical signicance. Our inferences are in line with previous findings.of the estimation setup, the wavelet-based estimator may become an attractive robust alternative to the traditional methods