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Technical Efficiency Of Rural Water Utilities

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  • Bhattacharyya, Arunava
  • Harris, Thomas R.
  • Narayanan, Rangesan
  • Raffiee, Kambiz

Abstract

Technical efficiency of rural water utilities is determined using frontier production functions. An indirect production function is developed to model the two-step production process of a local government-controlled firm. Data from 26 rural Nevada water utilities are used to estimate inefficiency in terms of firm-specific variables. A multistep estimation procedure is used instead of single-step maximum likelihood estimation. Model selection tests are used to choose the best model. Privately owned utilities are most efficient; self-governing water districts are the least efficient. Municipal governments operate the most and least efficient utilities.

Suggested Citation

  • Bhattacharyya, Arunava & Harris, Thomas R. & Narayanan, Rangesan & Raffiee, Kambiz, 1995. "Technical Efficiency Of Rural Water Utilities," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 20(2), pages 1-19, December.
    • Handle: RePEc:ags:jlaare:30764
    DOI: 10.22004/ag.econ.30764
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    References listed on IDEAS

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    Cited by:

    1. Johannes Sauer & Klaus Frohberg, 2007. "Allocative efficiency of rural water supply – a globally flexible SGM cost frontier," Journal of Productivity Analysis, Springer, vol. 27(1), pages 31-40, February.
    2. Zhang, Fan & Fogarty, James, 2015. "Nonmarket Valuation of Water Sensitive Cities: Current Knowledge and Issues," Working Papers 207694, University of Western Australia, School of Agricultural and Resource Economics.
    3. Picazo-Tadeo, Andres J. & Saez-Fernandez, Francisco J. & Gonzalez-Gomez, Francisco, 2008. "Does service quality matter in measuring the performance of water utilities," Utilities Policy, Elsevier, vol. 16(1), pages 30-38, March.
    4. Obeng, K. & Sakano, R., 2020. "Effects of government regulations and input subsidies on cost efficiency: A decomposition approach," Transport Policy, Elsevier, vol. 91(C), pages 95-107.
    5. Tim Coelli & Shannon Walding, 2005. "Performance Measurement in the Australian Water Supply Industry," CEPA Working Papers Series WP012005, School of Economics, University of Queensland, Australia.
    6. Sauer, Johannes, 2004. "Rural Water Suppliers And Efficiency - Empirical Evidence From East And West Germany," IAMO Discussion Papers 14866, Institute of Agricultural Development in Transition Economies (IAMO).
    7. Obeng, K. & Sakano, R. & Naanwaab, C., 2016. "Understanding overall output efficiency in public transit systems: The roles of input regulations, perceived budget and input subsidies," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 89(C), pages 133-150.
    8. Shih, Jhih-Shyang & Harrington, Winston & Pizer, William A. & Gillingham, Kenneth, 2004. "Economies of Scale and Technical Efficiency in Community Water Systems," Discussion Papers 10788, Resources for the Future.
    9. Bottasso, Anna & Conti, Maurizio, 2009. "Scale economies, technology and technical change in the water industry: Evidence from the English water only sector," Regional Science and Urban Economics, Elsevier, vol. 39(2), pages 138-147, March.
    10. Sauer, Johannes, 2004. "Rural water suppliers and efficiency: Empirical evidence from East and West Germany," IAMO Discussion Papers 63, Leibniz Institute of Agricultural Development in Transition Economies (IAMO).
    11. Sauer Johannes, 2005. "Die optimale Organisation der Wasserversorgung aus ökonomischer Perspektive / The Optimal Organisation of the Water Supplying Industry – An Economic Perspective," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 225(2), pages 225-244, April.
    12. Miguel A. García-Rubio & Francisco González-Gómez & Jorge Guardiola, 2009. "Performance and ownership in the governance of urban water," FEG Working Paper Series 09/03, Faculty of Economics and Business (University of Granada).
    13. Estache, Antonio & Kouassi, Eugene, 2002. "Sector organization, governance, and the inefficiency of African water utilities," Policy Research Working Paper Series 2890, The World Bank.
    14. Roberto Martínez-Espiñeira & Maria A. García-Valiñas & Francisco González-Gómez, 2007. "Does Private Management Of Water Supply Services Really Increase Prices? An Empirical Analysis," FEG Working Paper Series 07/05, Faculty of Economics and Business (University of Granada).

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