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The “social choice” of privatising urban water services: a case study of Madrid in Spain

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  • Alberto Ruiz-Villaverde

    (Universidad de Granada.)

  • Andrés J. Picazo-Tadeo

    (Universidad de Valencia)

  • Francisco González-Gómez

    (Universidad de Granada.)

Abstract

In countries where privatisation is permitted by law, policymakersusually give different reasons of general interest to allow private companies tomanage water services. However, these kinds of decisions often provoke intensepolitical debate and are at times opposed by citizens. In this paper, we illustratehow Analytic Hierarchy Process (AHP) techniques can be used to analyse therationality of complex decisions regarding the management of water services. As acase study, we analyse the recent decision taken by the Regional Government ofMadrid (Spain) to part-privatise the management of water services by introducing aprivate partner. In doing so, we use information from a questionnaire completed bya panel of five experts in water management, including both scholars andprofessionals. The results raise doubts about the rationality of the decision toprivatise water services in Madrid. Rather than social interest, other reasons may bebehind the decision, such as satisfying private interests whilst continuing to takeadvantage of maintaining public institution status.

Suggested Citation

  • Alberto Ruiz-Villaverde & Andrés J. Picazo-Tadeo & Francisco González-Gómez, 2013. "The “social choice” of privatising urban water services: a case study of Madrid in Spain," Working Papers 1322, Department of Applied Economics II, Universidad de Valencia.
    • Handle: RePEc:eec:wpaper:1322
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    Cited by:

    1. Alonso, José M. & Clifton, Judith & Díaz-Fuentes, Daniel, 2017. "The impact of government outsourcing on public spending: Evidence from European Union countries," Journal of Policy Modeling, Elsevier, vol. 39(2), pages 333-348.
    2. Boardman, Anthony E. & Vining, Aidan R. & Weimer, David L., 2016. "The long-run effects of privatization on productivity: Evidence from Canada," Journal of Policy Modeling, Elsevier, vol. 38(6), pages 1001-1017.
    3. Ruiz-Villaverde, Alberto & González-Gómez, Francisco & J. Picazo- Tadeo, Andrés, 2015. "The privatisation of urban water services: theory and empirical evidence in the case of Spain," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, issue 31, pages 157-174.
    4. Alberto Ruiz-Villaverde & Miguel A. García-Rubio, 2017. "Public Participation in European Water Management: from Theory to Practice," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 31(8), pages 2479-2495, June.
    5. M. Isabel Sanchez-Hernandez & Juan José Maldonado-Briegas & Ramón Sanguino & Ascensión Barroso & M. Cristina Barriuso, 2021. "Users’ Perceptions of Local Public Water and Waste Services: A Case Study for Sustainable Development," Energies, MDPI, vol. 14(11), pages 1-17, May.

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    More about this item

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • H83 - Public Economics - - Miscellaneous Issues - - - Public Administration
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out

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