Water Nationalization: network access, water quality, and health outcomes
AbstractIn the case of natural monopolies there tends to be a trade-off between a higher quality of output provided by private firms, and a better access for poor consumers provided by public firms. This is partly the reflection of differences in objectives by private and public firms. The former tend to be profit-driven, whereas the latter tend to base decisions on political agendas (Chong and Lopez de Silanes, 2005). The objective of this paper is to explore the impact on network access, water quality, and health outcomes of Uruguay's nationalization of water services. An important advantage of focusing on nationalization rather than privatization is that it avoids selection bias due to cherry-picking by firms or governments at the time of privatization. Indeed, nationalization in Uruguay affected all private firms, as water was declared "part of the public domain". Results suggest that the change in ownership led to an increase in the sanitation rate, as well as improvements in water quality. It was also accompanied by a decline in water-related child mortality, although this latter e ect tends not to be statistically significant across most specifications.
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Bibliographic InfoPaper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 8415.
Date of creation: Jun 2011
Date of revision:
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Other versions of this item:
- Fernando Borraz & Nicolas Gonzalez Pampillon & Marcelo Olarreaga, 2011. "Water Nationalization: network access, quality, and health outcomes," Research Papers by the Institute of Economics and Econometrics, Geneva School of Economics and Management, University of Geneva 11051, Institut d'Economie et Econométrie, Université de Genève.
- Fernando Borraz & Nicolás Gonzalez Pampillón & Marcelo Olarreaga, 2011. "Water nationalization: network access, quality, and health outcomes," Documentos de Trabajo (working papers) 1811, Department of Economics - dECON.
- D60 - Microeconomics - - Welfare Economics - - - General
- F10 - International Economics - - Trade - - - General
- H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
- I10 - Health, Education, and Welfare - - Health - - - General
- L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
- O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-06-11 (All new papers)
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