General Equilibrium Effects Caused by California's Drought?
A quote: "Fresnans have long resisted water-saving measures, clinging tenaciously to a flat (pricing) rate, all-you-can-use system. Nudged by state and federal officials, Fresno began outfitting new homes with water meters in the early 1990s, but voters passed a ballot initiative prohibiting the city from actually reading them. It took two decades for all area homes to acquire meters and for the city to start monitoring the units. To its credit, Fresno has a watering schedule, limiting when residents can water their lawns. But enforcement, to put it charitably, is lax."
I am from Fresno, and Matt missed an important effect about the water meters. They use wireless technology and the water department can read water usage with accuracy. So they notice our leaks, and inform us about the problem on a household basis. Hence, we have all, including me, been on a hunt for the water leaks, and fixing them very fast.
Also, I might add, the completion of water meter installation was rushed forward by the stimulus, one of the few places where we had a multiplier greater than one.
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