Household Income in the United States and Water Usage Essay

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Introduction
The water shortage issue in the Monterey Peninsula is one of the more challenging water issues in the West Coast. Due to the emergency state of water shortage, the Monterey community is searching for solutions to reduce water consumption in the area. In order to attempt to find solutions on this issue that will benefit the local community and environment in the long-term, students from the Monterey Institute of International Studies’ Data Analysis classes conducted surveys to evaluate Monterey County’s coastal residents’ opinion on topics regarding water in general and their perceptions of the current water shortage in Monterey County. Extracting data from this survey, the authors of this paper examined which factors affect an individual’s likelihood of reducing his or her water consumption. In this paper, previously tested variables such as income as well as less-used variables were tested. Accordingly, the research question asks, “How do indicators such as income, age, economic views, perspectives on water usage as an economic or environmental issue, household size and years of residence affect one’s water reduction behavior?” Thus, the goal of this research is to investigate how these factors play a role in decreasing water usage and to recommend appropriate policies to improve the water situation in Monterey County. The paper is structured as follows. Section II is a literature review regarding the topic on water shortage issues and restates the research question. Section III is a data dictionary that shows the variables that were used in this research and any transformations that were applied to these variables from the original data from the surveys. Section IV describes the analytic methods and discusses the reasoning behind why they were chosen for this project. Section V is the output and finding from the tests that were run on R. Section VI analyzes the output and findings. Section VII discusses the policy relevance based on the previous section. Finally, the bibliography and appendices are added.

Literature Review and Research Question Grafton, Kompas, To & Ward (2009)’s cross-country study of 10 OECD countries shows that several factors play into household’s water usage behavior. They found that these factors, which include household size, residence size, higher education, full-time employment and household income, increase water consumption. In addition, they found that attitudinal characteristics do not have statistically effect on water consumption behavior, but can potentially increase one’s water conservation behavior.
While Grafton, Kompas, To & Ward examined data from a select group of countries that are OECD ranked; other studies were conducted at more local levels, looking at cities as the standard unit of measurement. Uhlendahl, Ziegelmayer, Wienecke, Mawisa & du Pisani (2010) explore water consumption at the household level in the city of Windhoek, Namibia. They conclude that in Windhoek, water consumption is low in low-income areas with informal settlements because of the lack of access to water and that water consumption only covers their basic needs; thus, one’s behavior towards water consumption is an accessibility issue in Windhoek. While the two studies examine water consumption behavior outside of the United States, Hogue, Pincetl & Mini (2013) studied the patterns and key drivers of Los Angeles’ residential water consumption by developing models that predict future residential water usage based on certain climate and land use scenarios. They concluded that ultimately, income is the key driver in water consumption in Los Angeles, but other factors such as landscape greenness, water rates and Tier 1 volume affect single-family
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