Getting the assumptions right: essays on the demand and supply of piped water services in developing countries

PhD ceremony: mw. C.H.J.M. van den Berg, 14.30 uur, Aula Academiegebouw, Broerstraat 5, Groningen

Dissertation: Getting the assumptions right: essays on the demand and supply of piped water services in developing countries

Promotor(s): prof. H. Folmer

Faculty: Spatial Sciences

Water is a key to life. An efficient allocation of water resources is important not only to guarantee public health, but also economic growth as water is a key resource for agriculture and industry. In many developing countries, progress has been made in improving access to services, but the financial sustainability of this access is still far from secured. As customers do not pay the full cost of water services, government subsidies are needed. Yet, it has proved hard to guarantee a steady and consistent flow of targeted subsidies. With the resulting financing gaps, investments are not being undertaking, resulting in water pollution and jeopardizing further improvements in access.

In view of these challenges, the major theme of this thesis is that lack of knowledge of (drinking) water markets in developing countries is pervasive. Most of the literature is focused on developed countries. As a result, many of the lessons learned from developed countries are used when setting policies in developing countries. Copying models and standards of developed countries to developing countries may not necessarily result in optimal policies, if water markets in developing countries have different features than those in developed countries. Most notably, the market for piped water in many developing countries tends to be much less homogeneous than in many developed countries. With different water sources available for different uses, at different levels of water, customers’ incentives to use piped water vis-à-vis other water sources might be different from those of customers in developed countries.