Article | Marketing area | Year 2020 | |
Sustainable policy for water pricing in Kuwaitby A. Aljamal; M. Speece; M. Bagnied | |
Sustainability (Switzerland) 12(8), p.3257 |
AbstractThis research investigates consumer willingness to pay (WTP) for water in Kuwait as a
foundation for policy decisions on reducing water subsidies. Heavy subsidies have encouraged
unsustainable very high consumption, but efforts to cut subsidies can generate strong political
opposition. A survey (n = 443) indicates that WTP is greater at lower prices, but resistance is not
purely about price. The presence of a continued partial water subsidy for basic household use slightly
increases WTP, probably mainly from perceptions of fairness. Information about Kuwait’s water
scarcity also has a small impact. All of these effect sizes are small, so we discuss these issues using a
nudge framework from behavioral economics. A number of policies can foster small shifts in WTP;
collectively they may have larger impact and make subsidy reduction relatively painless.
Keywords: willingness to pay; water pricing; subsidies; sustainability; Kuwait |