Plumbing vs Nudging: The Lasting Effect of Efficiency Improvements on Water Conservation

In this paper, we investigate two solutions to urban water security challenges: plumbing and nudging. Using anonymized monthly billing data from 1.5 million accounts in Singapore over ten years, our staggered difference-in-differences estimates show that a nationwide Home Improvement Programme that improves the efficiency of plumbing reduces residential water consumption by 3.5%. This effect persists over a decade and is robust across population subgroups. Efficiency improvements could enhance the efficacy of other conservation polices and mitigate the effects of excessive heat, rainfall and air pollution. The savings from efficiency improvements on utility bills are small, but the increase in housing value exceeds the private cost of the Home Improvement Programme. However, an evaluation of a nationwide peer-comparison nudging programme finds no evidence of reduced water consumption. Overall, we show that plumbing improvements generate long-lasting effects on water conservation.

Agarwal, Sumit and Araral, Eduardo and Fan, Mingxuan and Qin, Yu and Zheng, Huanhuan, Water Conservation Through Plumbing and Nudging (March 30, 2021). Nature Human Behaviour (2022). https://www.nature.com/articles/s41562-022-01320-y, Available at SSRN: https://ssrn.com/abstract=3815431 or http://dx.doi.org/10.2139/ssrn.3815431