IDEAS home Printed from https://ideas.repec.org/a/spr/waterr/v27y2013i5p1551-1562.html
   My bibliography  Save this article

Does Size Matter? Operating Cost Coverage for Water Utilities

Author

Listed:
  • Konstantinos Tsagarakis

Abstract

This paper compares the operational cost coverage index from 1132 water utilities for five countries (Albania, Brazil, Norway, Russia and Poland). The data used is available through the International Benchmarking Network (IBNET) for Water and Sanitation Utilities. By comparing means or medians of different serving population groups, it was shown that significant financial gains can be achieved by larger utilities. Such analysis can assist decision makers pursue merging of water utilities for profit maximizing purposes. The importance of benchmarking is also emphasized in order to illustrate the utility of the perused statistical analysis. Copyright Springer Science+Business Media Dordrecht 2013

Suggested Citation

  • Konstantinos Tsagarakis, 2013. "Does Size Matter? Operating Cost Coverage for Water Utilities," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 27(5), pages 1551-1562, March.
    • Handle: RePEc:spr:waterr:v:27:y:2013:i:5:p:1551-1562
    DOI: 10.1007/s11269-012-0256-1
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s11269-012-0256-1
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11269-012-0256-1?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Nauges, Celine & van den Berg, Caroline, 2007. "How"natural"are natural monopolies in the water supply and sewerage sector ? Case studies from developing and transition economies," Policy Research Working Paper Series 4137, The World Bank.
    2. Mukul Kulshrestha, 2006. "A scorecard for measuring the water supply utility performance: the case of large Indian metropolises," International Journal of Management and Decision Making, Inderscience Enterprises Ltd, vol. 7(4), pages 418-437.
    3. Corton, Maria Luisa, 2003. "Benchmarking in the Latin American water sector: the case of Peru," Utilities Policy, Elsevier, vol. 11(3), pages 133-142, September.
    4. Fumitoshi Mizutani & Takuya Urakami, 2001. "articles: Identifying network density and scale economies for Japanese water supply organizations," Papers in Regional Science, Springer;Regional Science Association International, vol. 80(2), pages 211-230.
    5. Fiorenzo Franceschini & Elisa Turina, 2012. "Proposal for a Performance Dashboard for the Monitoring of Water and Sewage Service Companies (WaSCs)," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 26(1), pages 63-80, January.
    6. Abbott, Malcolm & Cohen, Bruce, 2009. "Productivity and efficiency in the water industry," Utilities Policy, Elsevier, vol. 17(3-4), pages 233-244, September.
    7. Serge Garcia & Alban Thomas, 2001. "The Structure of Municipal Water Supply Costs: Application to a Panel of French Local Communities," Journal of Productivity Analysis, Springer, vol. 16(1), pages 5-29, July.
    8. John Houtsma, 2003. "Water Supply in California: Economies of Scale, Efficiency, and Privatization," ERSA conference papers ersa03p379, European Regional Science Association.
    9. Torres, Marcelo & Morrison Paul, Catherine J., 2006. "Driving forces for consolidation or fragmentation of the US water utility industry: A cost function approach with endogenous output," Journal of Urban Economics, Elsevier, vol. 59(1), pages 104-120, January.
    10. Harrison Mutikanga & Saroj Sharma & Kalanithy Vairavamoorthy, 2011. "Multi-criteria Decision Analysis: A Strategic Planning Tool for Water Loss Management," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 25(14), pages 3947-3969, November.
    11. De Witte, Kristof & Marques, Rui, 2009. "Gaming in a benchmarking environment. A non-parametric analysis of benchmarking in the water sector," MPRA Paper 14679, University Library of Munich, Germany.
    12. Caroline van den Berg & Alexander Danilenko, 2011. "The IBNET Water Supply and Sanitation Performance Blue Book," World Bank Publications - Books, The World Bank Group, number 2545.
    13. Francisco González Gómez & Miguel Angel García Rubio, 2008. "Efficiency in the management of urban water services. What have we learned after four decades of research?," Hacienda Pública Española / Review of Public Economics, IEF, vol. 185(2), pages 39-67, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. María Molinos-Senante & Manuel Mocholi-Arce & Ramón Sala-Garrido, 2016. "Efficiency Assessment of Water and Sewerage Companies: a Disaggregated Approach Accounting for Service Quality," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(12), pages 4311-4328, September.
    2. Thomas A. Tsalis & Ioannis E. Nikolaou & Konstantinos P. Tsagarakis, 2020. "A benchmarking–scoring methodology for assessing the water risk disclosures of water utilities," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 22(7), pages 6473-6493, October.
    3. Shivendra Kumar & Andrew Groth & Ljubo Vlacic, 2015. "Cost Evaluation of Water and Wastewater Treatment Plants Using Water Price Index," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 29(9), pages 3343-3356, July.
    4. María Molinos-Senante & Alexandros Maziotis & Ramon Sala-Garrido, 2017. "Assessment of the Total Factor Productivity Change in the English and Welsh Water Industry: a Färe-Primont Productivity Index Approach," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 31(8), pages 2389-2405, June.
    5. Norbert Brunner & Vijay Mishra & Ponnusamy Sakthivel & Markus Starkl & Christof Tschohl, 2015. "The Human Right to Water in Law and Implementation," Laws, MDPI, vol. 4(3), pages 1-59, August.
    6. Molinos-Senante, María & Hernández-Sancho, Francesc & Mocholí-Arce, Manuel & Sala-Garrido, Ramón, 2014. "Economic and environmental performance of wastewater treatment plants: Potential reductions in greenhouse gases emissions," Resource and Energy Economics, Elsevier, vol. 38(C), pages 125-140.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Abbott, Malcolm & Cohen, Bruce, 2009. "Productivity and efficiency in the water industry," Utilities Policy, Elsevier, vol. 17(3-4), pages 233-244, September.
    2. Ferro, Gustavo & Lentini, Emilio & Mercadier, Augusto & Romero, Carlos A., 2010. "Retornos a escala en agua y saneamiento: estimaciones para América Latina [Returns to scale in water and sanitation: estimates for Latin Amercia]," MPRA Paper 20324, University Library of Munich, Germany, revised Jan 2010.
    3. Klien, Michael & Michaud, David, 2019. "Water utility consolidation: Are economies of scale realized?," Utilities Policy, Elsevier, vol. 61(C).
    4. Andrea Guerrini & Giulia Romano & Bettina Campedelli, 2013. "Economies of Scale, Scope, and Density in the Italian Water Sector: A Two-Stage Data Envelopment Analysis Approach," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 27(13), pages 4559-4578, October.
    5. Alexandr Akimov & Paul Simshauser, 2018. "Performance measurement in Australian water utilities: Current state and future directions," Discussion Papers in Finance finance:201802, Griffith University, Department of Accounting, Finance and Economics.
    6. Angel Prieto & José L. Zofio & Inmaculada Alvarez, 2009. "Economías de escala, densidad y alcance en la provisión pública de infraestructura básica municipal," Hacienda Pública Española / Review of Public Economics, IEF, vol. 190(3), pages 59-94, September.
    7. Malcolm Abbott & Bruce Cohen, 2010. "Industry Structure Issues in the Water and Wastewater Sectors in Australia," Economic Papers, The Economic Society of Australia, vol. 29(1), pages 48-63, March.
    8. Walter, Matthias & Cullmann, Astrid & von Hirschhausen, Christian & Wand, Robert & Zschille, Michael, 2009. "Quo vadis efficiency analysis of water distribution? A comparative literature review," Utilities Policy, Elsevier, vol. 17(3-4), pages 225-232, September.
    9. Saal David S. & Arocena Pablo & Maziotis Alexandros & Triebs Thomas, 2013. "Scale and Scope Economies and the Efficient Vertical and Horizontal Configuration of the Water Industry: A Survey of the Literature," Review of Network Economics, De Gruyter, vol. 12(1), pages 93-129, March.
    10. Zschille, Michael, 2012. "Consolidating the Water Industry: An Analysis of the Potential Gains from Horizontal Integration in a Conditional Efficiency Fr," CEPR Discussion Papers 8737, C.E.P.R. Discussion Papers.
    11. Liu, Junqing & Fukushige, Mototsugu, 2020. "Efficiency and pricing of water supply and sewerage services in Japan," Utilities Policy, Elsevier, vol. 62(C).
    12. Romano, Giulia & Guerrini, Andrea, 2011. "Measuring and comparing the efficiency of water utility companies: A data envelopment analysis approach," Utilities Policy, Elsevier, vol. 19(3), pages 202-209.
    13. Carvalho, Pedro & Marques, Rui Cunha & Berg, Sanford, 2012. "A meta-regression analysis of benchmarking studies on water utilities market structure," Utilities Policy, Elsevier, vol. 21(C), pages 40-49.
    14. Mande Buafua, Patrick, 2015. "Efficiency of urban water supply in Sub-Saharan Africa: Do organization and regulation matter?," Utilities Policy, Elsevier, vol. 37(C), pages 13-22.
    15. Takuya Urakami & David Parker, 2011. "The Effects of Consolidation amongst Japanese Water Utilities," Urban Studies, Urban Studies Journal Limited, vol. 48(13), pages 2805-2825, October.
    16. Ángel M. Prieto & José L. Zofío & Inmaculada Álvarez, 2015. "Cost economies, urban patterns and population density: The case of public infrastructure for basic utilities," Papers in Regional Science, Wiley Blackwell, vol. 94(4), pages 795-816, November.
    17. Michael Zschille, 2015. "Consolidating the water industry: an analysis of the potential gains from horizontal integration in a conditional efficiency framework," Journal of Productivity Analysis, Springer, vol. 44(1), pages 97-114, August.
    18. Michael Zschille, 2012. "Consolidating the Water Industry: An Analysis of the Potential Gains from Horizontal Integration in a Conditional Efficiency Framework," Discussion Papers of DIW Berlin 1187, DIW Berlin, German Institute for Economic Research.
    19. James I. Price & Steven Renzetti & Diane Dupont & Wiktor Adamowicz & Monica B. Emelko, 2017. "Production Costs, Inefficiency, and Source Water Quality: A Stochastic Cost Frontier Analysis of Canadian Water Utilities," Land Economics, University of Wisconsin Press, vol. 93(1), pages 1-11.
    20. Peeter Peda & Giuseppe Grossi & Margo Liik, 2013. "Do ownership and size affect the performance of water utilities? Evidence from Estonian municipalities," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 17(2), pages 237-259, May.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:waterr:v:27:y:2013:i:5:p:1551-1562. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.