This paper analyses the effect of several economic, environmental and social determinants for the per capita demand for water in Libya. In this study, the econometric model based on E-views method, instrumental and ARDL model are applied. The cointegration analysis has shown a significant positive effect of temperature on water demand over the short and long term. Also, there is a positive relationship between rainfall and water demand in the long term and its less impact in the short term. There is a significant positive relationship between urban population and water demand. On the other hand, there is a significant negative effect of income on water demand. Therefore, water demand is inflexible to changes in income. The study demonstrated that there is a negative effect on water price in relation to water demand. The estimated long-term variable of water value is 220.98.
International Journal of Innovation and Sustainable Development – Inderscience Publishers
Published: Jan 1, 2021