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Technical Efficiency Of Rural Water Utilities

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  • Bhattacharyya, Arunava
  • Harris, Thomas R.
  • Narayanan, Rangesan
  • Raffiee, Kambiz

Abstract

Technical efficiency of rural water utilities is determined using frontier production functions. An indirect production function is developed to model the two-step production process of a local government-controlled firm. Data from 26 rural Nevada water utilities are used to estimate inefficiency in terms of firm-specific variables. A multistep estimation procedure is used instead of single-step maximum likelihood estimation. Model selection tests are used to choose the best model. Privately owned utilities are most efficient; self-governing water districts are the least efficient. Municipal governments operate the most and least efficient utilities.

Suggested Citation

  • Bhattacharyya, Arunava & Harris, Thomas R. & Narayanan, Rangesan & Raffiee, Kambiz, 1995. "Technical Efficiency Of Rural Water Utilities," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 20(2), pages 1-19, December.
    • Handle: RePEc:ags:jlaare:30764
    DOI: 10.22004/ag.econ.30764
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    References listed on IDEAS

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    Cited by:

    1. Sauer, Johannes, 2004. "Rural water suppliers and efficiency: Empirical evidence from East and West Germany," IAMO Discussion Papers 63, Leibniz Institute of Agricultural Development in Transition Economies (IAMO).
    2. Obeng, K. & Sakano, R. & Naanwaab, C., 2016. "Understanding overall output efficiency in public transit systems: The roles of input regulations, perceived budget and input subsidies," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 89(C), pages 133-150.
    3. Bottasso, Anna & Conti, Maurizio, 2009. "Scale economies, technology and technical change in the water industry: Evidence from the English water only sector," Regional Science and Urban Economics, Elsevier, vol. 39(2), pages 138-147, March.
    4. Picazo-Tadeo, Andres J. & Saez-Fernandez, Francisco J. & Gonzalez-Gomez, Francisco, 2008. "Does service quality matter in measuring the performance of water utilities," Utilities Policy, Elsevier, vol. 16(1), pages 30-38, March.
    5. Estache, Antonio & Kouassi, Eugene, 2002. "Sector organization, governance, and the inefficiency of African water utilities," Policy Research Working Paper Series 2890, The World Bank.
    6. Tim Coelli & Shannon Walding, 2005. "Performance Measurement in the Australian Water Supply Industry," CEPA Working Papers Series WP012005, School of Economics, University of Queensland, Australia.
    7. Johannes Sauer & Klaus Frohberg, 2007. "Allocative efficiency of rural water supply – a globally flexible SGM cost frontier," Journal of Productivity Analysis, Springer, vol. 27(1), pages 31-40, February.
    8. Roberto Martínez-Espiñeira & Maria A. García-Valiñas & Francisco González-Gómez, 2007. "Does Private Management Of Water Supply Services Really Increase Prices? An Empirical Analysis," FEG Working Paper Series 07/05, Faculty of Economics and Business (University of Granada).
    9. Sauer, Johannes, 2004. "Rural Water Suppliers And Efficiency - Empirical Evidence From East And West Germany," IAMO Discussion Papers 14866, Institute of Agricultural Development in Transition Economies (IAMO).
    10. Pizer, William & Harrington, Winston & Shih, Jhih-Shyang & Gillingham, Kenneth, 2004. "Economies of Scale and Technical Efficiency in Community Water Systems," RFF Working Paper Series dp-04-15, Resources for the Future.
    11. Miguel A. García-Rubio & Francisco González-Gómez & Jorge Guardiola, 2009. "Performance and ownership in the governance of urban water," FEG Working Paper Series 09/03, Faculty of Economics and Business (University of Granada).
    12. Obeng, K. & Sakano, R., 2020. "Effects of government regulations and input subsidies on cost efficiency: A decomposition approach," Transport Policy, Elsevier, vol. 91(C), pages 95-107.
    13. Zhang, Fan & Fogarty, James, 2015. "Nonmarket Valuation of Water Sensitive Cities: Current Knowledge and Issues," Working Papers 207694, University of Western Australia, School of Agricultural and Resource Economics.
    14. Sauer Johannes, 2005. "Die optimale Organisation der Wasserversorgung aus ökonomischer Perspektive / The Optimal Organisation of the Water Supplying Industry – An Economic Perspective," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 225(2), pages 225-244, April.

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