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Financing Municipal Water and Sanitation Services in Nairobi’s Informal Settlements

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  • Coville,Aidan
  • Galiani,Sebastian Franco
  • Gertler,Paul J.
  • Yoshida,Susumu

Abstract

This study estimates the impacts of two interventions implemented as field experiments in informal settlements by Nairobi’s water and sanitation utility to improve revenue collection efficiency and last mile connection loan repayment: (i) face-to-face engagement between utility staff and customers to encourage payment and (ii) contract enforcement for service disconnection due to nonpayment in the form of transparent and credible disconnection notices. While there is no effect of the engagement, the study finds large effects of enforcement on payment. There is no effect on access to water, perceptions of utility fairness or quality of service delivery, on the relationships between tenants and property owners, or on tenant mental well-being nine months after the intervention. To counterbalance the increase in payments, property owners increased rental income by renting out additional space. Taken together these results suggest that transparent contract enforcement was effective at improving revenue collection efficiency without incurring large social or political costs.

Suggested Citation

  • Coville,Aidan & Galiani,Sebastian Franco & Gertler,Paul J. & Yoshida,Susumu, 2021. "Financing Municipal Water and Sanitation Services in Nairobi’s Informal Settlements," Policy Research Working Paper Series 9725, The World Bank.
    • Handle: RePEc:wbk:wbrwps:9725
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    More about this item

    Keywords

    Hydrology; Health and Sanitation; Small Private Water Supply Providers; Sanitary Environmental Engineering; Water and Human Health; Water Supply and Sanitation Economics; Town Water Supply and Sanitation; Engineering; Environmental Engineering; Sanitation and Sewerage; Health Care Services Industry;
    All these keywords.

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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