Water demand and the urban poor: A study of the factors influencing water consumption among housholds in Cape Town, South Africa

Water demand management is a key focus area for most water managers and even more so in developing countries since improved access to water is important to the poor. Different policies have been introduced to ensure a water management system that cares for the poor, among them the Increasing Block Tariff (IBT) structure. Studies demonstrate that it is very important to know the shape of the demand curve when deciding on the IBT structure. This paper adds to the understanding of the factors that influence water consumption. The focus is on how water demand patterns vary with the level of income among urban dwellers. The results support the hypothesis that pricing is an ineffective measure to manage water consumption among the poor, while it is relatively more effective for the richest group. Therefore, redistribution using water pricing policy will hardly work.