Abstract
Good water management is essential to human development, people’s well-being, social inclusion, and environmental sustainability. The Sustainable Development Goals of the United Nations set forward an ambitious agenda of providing universal access to good quality water supply and sanitation services within a financially constrained environment. However, the various peculiarities of each country regarding water governance makes it difficult to identify and implement the best practices and benchmarks. When it comes to water governance issues, the private versus public management question stays at the core of the public debate, for ideological reasons but also for practical ones; when there is a need for investments the temptation to look for private finance is natural. We argue that it pushes to the background other issues which are at least equally important, such as the proper scale to operate water services, stakeholders’ engagement, or the need for independent regulatory agencies.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Similar content being viewed by others
Notes
- 1.
The data come from the water survey of the French Environment Institute (IFEN)/Observation and Statistics Department (SOeS). Five thousand French municipalities were surveyed in 1998, 2001, 2004, and 2008, which provided a representative panel of French water services. The survey was abandoned after 2008 and replaced with a French Observatory (Sispea) that was supposed to collect information from municipalities on every water service in France on a voluntary basis. The observatory exists, but despite multiple efforts to improve the situation, the data are far from representative and reliable.
- 2.
The water utility performance index (WUPI) of the World Bank is a simple global index measuring how closely a utility company operates to accepted good practices. The index is based on ten dimensions generally accepted as key performance indicators in the industry and available from the IBNET dataset for most utility companies in the region. Those dimensions fall into three categories: coverage (water, sewer, and wastewater treatment); quality (service continuity and sewer blockage); and management (metering, NRW, staff productivity, collection rate, and operating cost recovery).
References
Akhmouch, A., Clavreul, D., & Glas, P. (2018). Introducing the OECD Principles on Water Governance. International Water, 43, 5–12.
Athias, L., & Saussier, S. (2007). Contractual Flexibility or Rigidity for Public Private Partnerships? Theory and Evidence from Infrastructure Concession Contracts. Revue Economique, 58(3), 565–576.
Bel, G., González-Gómez, F., & Picazo-Tadeo, A. J. (2015). Does Market Concentration Affect Prices in the Urban Water Industry? Environment and Planning C, 33(6), 1546–1565.
Bertoméu, S., Camos, D., & Estache, A. (2018). Do Economic Regulatory Agencies Matter to Private-Sector Involvement in Water Utilities in Developing Countries. Utilities Policy, 50, 153–163.
Beuve, J., de Brux, J., & Saussier, S. (2013). Renégocier pour durer : une analyse empirique des contrats de concessions. Revue d’économie industrielle, 141(1), 117–148.
Beuve, J., Moszoro, M., & Saussier, S. (2018). Political Contestability and Public Contract Rigidity. Journal of Economics and Management Strategy, Forthcoming.
Bhattacharyya, A., Harris, T. R., Narayanan, R., et al. (1995). Specification and Estimation of the Effect of Ownership on the Economic Efficiency of the Water Utilities. Regional Science and Urban Economics, 25(6), 759–784.
Boycko, M., Shleifer, A., & Vishny, R. W. (1996). A Theory of Privatization. The Economic Journal, 106, 309–319.
Chong, E., Saussier, S., & Silverman, B. S. (2015). Water Under the Bridge: Determinants of Franchise Renewal in Water Provision. Journal of Law, Economics and Organization, 31(1), 3–39.
Clarke, G. R. G., Kosec, K., & Wallsten, S. (2009). Has Private Participation in Water and Sewerage Improved Coverage? Empirical Evidence from Latin America. Journal of International Development, 21(3), 327–361.
Desrieux, C., Eshien, C., & Saussier, S. (2013). Putting All One’s Eggs in One Basket: Relational Contracts and the Provision of Local Public Services. Journal of Economic Behavior & Organization, 89, 167–186.
Engel, E., Fischer, R., & Galetovic, A. (2011). Public-Private Partnerships to Revamp U.S. Infrastructure (pp. 1–26). The Hamilton Project—Brookings.
Estache, A., & Kouassi, E. (2002). Sector Organization, Governance, and the Inefficiency of African Water Utilities. Policy Research Working Paper Series 2890. Washington, DC: The World Bank.
Estache, A., & Rossi, M. (2002). How Different Is the Efficiency of Public and Private Water Companies in Asia? World Bank Economic Review, 16, 139–148.
Estache, A., & Saussier, S. (2014). Public-Private Partnerships and Efficiency: A Short Assessment. CESifo DICE Report, 12(3), 8–13.
Estache, A. (2006). PPI Partnerships vs. PPI Divorces in LDCs. Review of Industrial Organization, 29(1), 3–26.
Galiani, S., Gertler, P., & Schargrodsky, E. (2005). Water for Life: The Impact of the Privatization of Water Services on Child Mortality. Journal of Political Economy, 113(1), 83–120.
Garcia-Sanchez, I. M. (2006). Efficiency Measurement in Spanish Local Government: The Case of Municipal Water Services. Review of Policy Research, 23(2), 355–371.
García-Valiñas, M. A., González Gómez, F., & Picazo-Tadeo, A. J. (2013). Is the Price of Water for Residential Use Related to Provider Ownership? Empirical Evidence from Spain. Utilities Policy, 24, 59–69.
Guasch, J. L., Benitez, D., Portabales, I., & Flor, L. (2014). The Renegotiation of PPP Contracts: An Overview of Its Recent Evolution in Latin America. International Transport Forum Discussion Papers 2014/18, OECD Publishing.
Guasch, J.-L. (2004). Granting and Renegotiating Infrastructure Concession: Doing It Right. Mimeo: The World Bank.
Jensen, M. C., & Meckling, W. H. (1976). Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure. Journal of Financial Economics, 3(4), 305–360.
Kirkpatrick, C., Parker, D., & Zhang, Y.-F. (2006). State Versus Private Sector Provision of Water Services in Africa: An Empirical Analysis. The World Bank Economic Review, 20(1), 143–163.
Klein, B., Crawford, R. G., & Alchian, A. (1978). Vertical Integration, Appropriable Rents, and the Competitive Contracting Process. The Journal of Law and Economics, 21(2), 297–326.
Laffont, J.-J., & Tirole, J. (1993). A Theory of Incentives in Procurement and Regulation. Cambridge: MIT Press.
Laffont, J.-J. (2000). Etapes vers un Etat moderne : une analyse économique.
Lee, C. (2011). Privatization, Water Access and Affordability: Evidence from Malaysian Household Expenditure Data. Economic Modelling, 28(5), 2121–2128.
Lyon, T. P., Montgomery, A. W., & Zhao, D. (2018). A Change Would Do You Good: Privatization, Municipalization and Drinking Water Quality. Working Paper.
Marques, R., & De Witte, K. (2011). Is Big Better? On Scale and Scope Economies in the Portuguese Water Sector. Economic Modelling, 28(3), 1009–1016.
Martínez-Espiñeira, R., García-Valiñas, M. A., & González-Gómez, F. (2009). Does Private Management of Water Supply Services Really Increase Prices? An Empirical Analysis in Spain. Urban Studies, 46(4), 923–945.
McCubbins, M. D., & Schwartz, T. (1984). Congressional Oversight Overlooked: Police Patrols Versus Fire Alarms. American Journal of Political Science, 28(1), 165–179.
Mizutani, F., & Urakami, T. (2001). Identifying Network Density and Scale Economies for Japanese Water Supply Organizations. Papers in Regional Science, 80(2), 211–230.
Moszoro, M. W., & Spiller, P. T. (2012). Third-Party Opportunism and the Nature of Public Contracts. NBER w18636.
Moszoro, M. W., Spiller, P. T., & Stolorz, S. (2016). Rigidity of Public Contracts. Journal of Empirical Legal Studies, 13(3), 396–427.
National Audit Office. (2001). Managing the Relationship to Secure a Successful Partnership in PFI Contracts. Report by the Controller and Auditor General.
Nauges, C., & Whittington, D. (2017). Evaluating the Performance of Alternative Municipal Water Tariff Designs: Quantifying the Tradeoffs Between Equity, Economic Efficiency, and Cost Recovery. World Development, 91, 125–143.
OECD. (2012). Strategic Transport Infrastructure Needs to 2030. OECD Publishing. Retrieved from https://doi.org/10.1787/9789264114425-en.
OECD. (2015a). Principles on Water Governance. Retrieved from http://www.oecd.org/governance/regional-policy/OECD-Principles-on-Water-Governance.pdf.
OECD. (2015b). Stakeholder’s Engagement for Inclusive Water Governance. Retrieved from https://read.oecd-ilibrary.org/governance/stakeholder-engagement-for-inclusive-water-governance_9789264231122-en.
Porcher, S. (2014). Efficiency and Equity in Two-Part Tariffs: The Case of Residential Water Rates. Applied Economics, 46(5), 539–555.
Porcher, S. (2017). The ‘Hidden Costs’ of Water Provision: New Evidence from the Relationship Between Contracting-Out and Price in French Water Public Services. Utilities Policy, 48, 166–175.
Ruester, S., & Zschille, M. (2010). The Impact of Governance Structure on Firm Performance: An Application to the German Water Distribution Sector. Utilities Policy, 18(3), 154–162.
Saal, D. S., & Parker, D. (2000). The Impact of Privatization and Regulation on the Water and Sewerage Industry in England and Wales: A Translog Cost Function Model. Managerial and Decision Economics, 21(6), 253–268.
Saussier, S., & de Brux, J. (2018). The Economics of Public-Private Partnerships. Springer International Publishing.
Shih, J.-S., Harrington, W., Pizer, W. A., & Gillingham, K. (2004). Economies of Scale and Technical Efficiency in Community Water Systems. Resources for the Future, Discussion Paper 04-15.
Smets, H. (2004). La solidarité de l’eau potable: aspects économiques. Paris: Report, Académie de l’eau.
Smith, A. (1776). An Inquiry into the Nature and Causes of the Wealth of Nations. London: Strahan and Cadell.
Spiller, P. T. (2008). An Institutional Theory of Public Contracts: Regulatory Implications. NBER Working Paper (14152).
Stiel, C. (2017, December). Modern Public Enterprises: Organisational Innovation and Productivity. Working Paper 1713, DIW Berlin.
Whittington, D., Nauges, C., Fuente, D., & Wu, X. (2015). A Diagnostic Tool for Estimating the Incidence of Subsidies Delivered by Water Utilities in Low-and Medium-Income Countries, with Illustrative Simulations. Utilities Policy, 34, 70–81.
Williamson, O. E. (1985). The Economic Institutions of Capitalism. The Free Press.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2019 The Author(s)
About this chapter
Cite this chapter
Porcher, S., Saussier, S. (2019). Introduction. In: Porcher, S., Saussier, S. (eds) Facing the Challenges of Water Governance. Palgrave Studies in Water Governance: Policy and Practice. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-98515-2_1
Download citation
DOI: https://doi.org/10.1007/978-3-319-98515-2_1
Published:
Publisher Name: Palgrave Macmillan, Cham
Print ISBN: 978-3-319-98514-5
Online ISBN: 978-3-319-98515-2
eBook Packages: Social SciencesSocial Sciences (R0)