Análise da demanda de água bruta para a reutilização do Canal do Trabalhador

Abstract

This study has as objective to estimate the demand and price elasticity of demand for raw water to reactivate the Worker Canal in the state of Ceará. The analysis of demand is very important for the development of pricing policies that encourage the rational use and, at same time, cover the costs of the system of water treatment and distribution. The demand equations for irrigation and public supply company were estimated using the method of OLS, instrumental variable and Two-Stage Least Squares (2SLS). Based on the results we can conclude that the demand for irrigation is more sensitive to price changes than demand for public supply. The public supply company has decreasing costs to scale, so that, an increase in market size should reduce the average cost of water.