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Has private participation in water and sewerage improved coverage? - empirical evidence from Latin America


  • Clarke, George R. G.
  • Kosec, Katrina
  • Wallsten, Scott


Introducing private sector participation (PSP) into the water and sewerage sectors in developing countries is difficult and controversial. Empirical studies on its effects are scant and generally inconclusive. Case studies tend to find improvements in the sector following privatization, but they suffer from selection bias, and it is difficult to generalize from their results. To explore empirically the effects of PSP on coverage, we assemble a new dataset of connections to water and sewerage services at the city, and province level, based on household surveys in Argentina, Bolivia, and Brazil. The household surveys, conducted over a number of years, allow us to compile data, before and after the introduction of PSP, as well as from similar (control) regions that never privatized at all. Our analysis reveals that, in general, connection rates to piped water and sewerage, improved following the introduction of PSP, consistent with the case study literature. We also find, however, that connection rates similarly improved in the control regions, suggesting that PSP, per se, may not have been responsible for those improvements. On the other hand, connection rates for the poorest households also tended to increase in the regions with PSP, and in the control regions, suggesting that-in terms of connections at least-PSP did not harm the poor.

Suggested Citation

  • Clarke, George R. G. & Kosec, Katrina & Wallsten, Scott, 2004. "Has private participation in water and sewerage improved coverage? - empirical evidence from Latin America," Policy Research Working Paper Series 3445, The World Bank.
  • Handle: RePEc:wbk:wbrwps:3445

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    References listed on IDEAS

    1. Jalan, Jyotsna & Ravallion, Martin, 2003. "Does piped water reduce diarrhea for children in rural India?," Journal of Econometrics, Elsevier, vol. 112(1), pages 153-173, January.
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    More about this item


    Environmental Economics&Policies; Decentralization; Health Economics&Finance; Water Conservation; Water and Industry; Town Water Supply and Sanitation; Health Economics&Finance; Environmental Economics&Policies; Water Supply and Sanitation Governance and Institutions; Water and Industry;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation

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