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

Abstract Mega-cities worldwide are facing water security challenges. We investigate two solutions to urban water security: improving plumbing and nudging consumers. We show that improving plumbing alone generates long-lasting effects in water conservation. Using anonymised water consumption data based on water bills from 1.5 million accounts in Singapore over 10 years, our staggered difference-in-differences estimates show that a nation-wide Home Improvement Programme reduces residential water consumption by 3.5%. The effect persists for a decade and is observed across population subgroups. The efficiency improvements also help in mitigating the effect of extreme environmental conditions on water use. Nation-wide nudging through peer comparison may not achieve similar outcomes.