Quo vadis efficiency analysis of water distribution? A comparative literature review |
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Authors: | Matthias Walter Astrid Cullmann Christian von Hirschhausen Robert Wand Michael Zschille |
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Affiliation: | aDresden University of Technology, Faculty of Business and Economics, Chair of Energy Economics and Public Sector Management, 01062 Dresden, Germany;bDIW Berlin (German Institute for Economic Research), Department of International Economics, Mohrenstraße 58, 10117 Berlin, Germany;cDIW Berlin (German Institute for Economic Research), Department of Innovation, Manufacturing, Service, Mohrenstraße 58, 10117 Berlin, Germany |
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Abstract: | Recognizing the growing importance of scientific benchmarking in water distribution, we provide a comprehensive survey of the available literature. We begin with a discussion about the (limited) use of benchmarking in the regulation of UK water utilities, and then extend the analysis to regulated water sectors in other countries. We find no clear impact of public or private ownership; instead, the institutional settings appear to be a dominant driver of efficiency. Quality and structural variables are significant parameters; and water losses and population density are also important drivers. Analysis reveals that economies of scale only exist in fragmented water industries, whereas economies of density are omnipresent. We find evidence suggesting important economies of scope (e.g. between water and sewerage). Finally, we summarize the tensions that exist in attempting to measure efficiency in the water industry and draw conclusions about how to improve efficiency analysis in the future. |
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Keywords: | Water distribution Efficiency analysis Literature review |
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