Subsidies for Succulents: Evaluating the Las Vegas Cash-for-Grass Rebate Program


Baker, Jonathan. “Subsidies for Succulents: Evaluating the Las Vegas Cash-for-Grass Rebate Program.” Cambridge, Massachusetts, USA: Harvard Environmental Economics Program, 2017.
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I estimate the water savings and property value effects of a Las Vegas area water conservation program that subsidizes conversions of lawn to desert landscape. Using event studies and panel fixed-effects models, I find that the average conversion reduces baseline water consumption by 21 percent and increases property values by about 1 percent. In addition, my results show that water savings remain relatively stable over time; that water savings are inversely proportional to annual program take-up; that participants with high pre-conversion water demand save more water than participants with lower pre-conversion water demand; and that a 6 percent price increase would have achieved equivalent savings. I find little evidence of property value spillovers to neighboring properties. The program saves water at an annual rate of \$4.84/kgal and if I include an estimate of the scarcity value of water, generates net benefits of \$2.00 per square foot of desert landscape converted.

Last updated on 06/12/2017