Water shortages and implied water quality: A contingent valuation study

This paper analyses the extent to which households in an urban area are willing to pay to ensure a fully reliable water supply when the latter induces changes in drinking water quality. The water supply system in the city of Heraklion, Greece, is characterized by periodic water rationing, which is more pronounced in the summer months. The generalized use of cisterns and even water tanks helps residents cope with quantity shortages but has a negative effect on the quality of the water reaching their taps. The results of our contingent valuation show that respondents not affected by shortages and already drinking tap water have a smaller willingness to pay, while positive perceptions on quality have a positive effect.