How do we convince the world to use less water?

This article was originally published on The World Bank’s Governance for Development blog.

Crises in access to water are making headlines around the world. Among difficult policy pathways to respond, convincing people to change their behavior and reduce their consumption can be one of the hardest.

This post gives us a promising picture from Belén, a small town in Costa Rica. Of Belén’s 21,633 inhabitants, 99.3% have access to water service, but shortages are anticipated by 2030. Our recent study demonstrated that the government could cheaply encourage citizens to save water by enabling them to compare their consumption with that of their peers.

This is a timely lesson, as the United Nations estimates that more than two-thirds of the world’s population will live in water-stressed regions by 2025.  Demographic and economic pressures make water management an increasingly urgent policy priority even in water rich areas like Latin America, home to nearly 31% of the world’s freshwater resources.

While Costa Rica is relatively well-endowed with water resources, current demand virtually matches production capacity  Risks of water deficits and existing shortages are heightened by overdevelopment of areas with limited water supply. To help address these challenges, we partnered with local authorities in the small municipality of Belén to conduct a randomized control trial, capturing an innovative approach that can help conserve water across the country, and in similar contexts around the world.

The project built on insights from the growing field of behavioral economics, which challenges the underlying, intentionally simplified assumption of standard models: that people make rational decisions based on a self-interested cost-benefit analysis. Behavioral economics borrows from other sciences to consider the full scope of social and psychological influences on human decision-making.

Many water conservation initiatives have focused on communications and education campaigns—convincing people of the value of saving water—or on price increases to reduce demand. But communications efforts have had limited success.  Water demand also tends to be relatively inelastic—meaning that changes in price may not have a big effect on consumption, especially for wealthy households. When price-based tools do work, they can also be regressive, pricing out low-income households while the consumption of the wealthy changes little.

In Belén, focus groups revealed a wide consensus on the importance of water conservation, but few residents believed that they themselves needed to use less water. Moreover, few had a benchmark to understand, measure, and compare their water use. Based on this deeper understanding of the problem, the team was able to design and test behavioral policy approaches—also known as “nudges”—that can affect individual water use.

The study compared three randomized treatment groups and one control group. Consumers in the first treatment group were able to benchmark their consumption against the average consumption of neighborhood peers, and those in the second group against the average consumption of Belén’s residents. These consumers received with their bill an easy-to-read sticker with a smiley or “frowny” face indicating that they had consumed less or more than their peers. Residents in the third group received planning worksheets with their bills, prompting them to set a concrete goal to reduce their water consumption (compared with the neighborhood average) while checking off strategies that they would use.

The results were striking. While the social comparison with other city residents led to little change, both the neighborhood comparison and the planning prompt led to large (about 4.5 percent) reductions in water consumption over the following four months. The Costa Rican experience can help inform other developing countries, where accelerating urbanization often overwhelms the capacity of local water providers, and where more urban dwellers were without access to water services in 2010 than there were in 2000.

Approaches like this are cost effective. Results confirmed that raising awareness about how much water individuals consume, and enabling them to compare their consumption with that of peers, can go a long way in helping to change behavior in the use of this finite resource.