IDEAS home Printed from https://ideas.repec.org/a/spr/soinre/v155y2021i1d10.1007_s11205-020-02588-1.html
   My bibliography  Save this article

Assessing the Quality of Service of Water Companies: a ‘Benefit of the Doubt’ Composite Indicator

Author

Listed:
  • Ramon Sala-Garrido

    (University of Valencia)

  • Manuel Mocholí-Arce

    (University of Valencia)

  • María Molinos-Senante

    (Pontificia Universidad Católica de Chile
    Centro de Desarrollo Urbano Sustentable ANID/FONDAP/15110020
    Pontificia Universidad Católica de Chile)

Abstract

Evaluating the quality of service (QS) provided by water companies is essential to benchmark and regulate them. Composite indicators (CIs) are a useful tool for this as they consist of aggregated multiple performance indicators in a single index, providing a holistic assessment of the QS of water companies. In this study, the novel ‘benefit of doubt’ methodology was used in order to evaluate the QS of a sample of Chilean water companies, by computing CIs that integrate both direct and reverse indicators. Moreover, the estimation of the Nerlove–Luenberger super-efficiency CI allowed for the ranking of water companies based on their QS. Results showed that, on average, Chilean water companies provide water and sewerage services with high quality, as the mean CI of the QS estimated was 0.93. Nevertheless, the QS of 2 of the 24 water companies evaluated stood out remarkably. The second-stage analysis conducted revealed that the ownership and peak factor of water companies and water consumed by customers affects the QS of water companies. The methodological approach followed in this study to evaluate the QS of water companies would be very useful for water regulators, as the CI computed integrates both desirable and undesirable outputs.

Suggested Citation

  • Ramon Sala-Garrido & Manuel Mocholí-Arce & María Molinos-Senante, 2021. "Assessing the Quality of Service of Water Companies: a ‘Benefit of the Doubt’ Composite Indicator," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 155(1), pages 371-387, May.
    • Handle: RePEc:spr:soinre:v:155:y:2021:i:1:d:10.1007_s11205-020-02588-1
    DOI: 10.1007/s11205-020-02588-1
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11205-020-02588-1
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s11205-020-02588-1?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. S C Ray, 2008. "The directional distance function and measurement of super-efficiency: an application to airlines data," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 59(6), pages 788-797, June.
    2. Per Andersen & Niels Christian Petersen, 1993. "A Procedure for Ranking Efficient Units in Data Envelopment Analysis," Management Science, INFORMS, vol. 39(10), pages 1261-1264, October.
    3. Pinto, F.S. & Costa, A.S. & Figueira, J.R. & Marques, R.C., 2017. "The quality of service: An overall performance assessment for water utilities," Omega, Elsevier, vol. 69(C), pages 115-125.
    4. Francesco Vidoli & Elisa Fusco & Claudio Mazziotta, 2015. "Non-compensability in Composite Indicators: A Robust Directional Frontier Method," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 122(3), pages 635-652, July.
    5. Luiza Bădin & Cinzia Daraio & Léopold Simar, 2014. "Explaining inefficiency in nonparametric production models: the state of the art," Annals of Operations Research, Springer, vol. 214(1), pages 5-30, March.
    6. Fusco, Elisa & Vidoli, Francesco & Rogge, Nicky, 2020. "Spatial directional robust Benefit of the Doubt approach in presence of undesirable output: An application to Italian waste sector," Omega, Elsevier, vol. 94(C).
    7. Cinzia Daraio & Léopold Simar, 2005. "Introducing Environmental Variables in Nonparametric Frontier Models: a Probabilistic Approach," Journal of Productivity Analysis, Springer, vol. 24(1), pages 93-121, September.
    8. Fuentes, R. & Torregrosa-Martí, T. & Hernández-Sancho, F., 2017. "Productivity of wastewater treatment plants in the Valencia Region of Spain," Utilities Policy, Elsevier, vol. 46(C), pages 58-70.
    9. Guerrini, Andrea & Romano, Giulia & Leardini, Chiara, 2018. "Economies of scale and density in the Italian water industry: A stochastic frontier approach," Utilities Policy, Elsevier, vol. 52(C), pages 103-111.
    10. Vilanova, Mateus Ricardo Nogueira & Magalhães Filho, Paulo & Balestieri, José Antônio Perrella, 2015. "Performance measurement and indicators for water supply management: Review and international cases," Renewable and Sustainable Energy Reviews, Elsevier, vol. 43(C), pages 1-12.
    11. Chen, Yao, 2004. "Ranking efficient units in DEA," Omega, Elsevier, vol. 32(3), pages 213-219, June.
    12. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    13. Rogge, Nicky & De Jaeger, Simon & Lavigne, Carolien, 2017. "Waste Performance of NUTS 2-regions in the EU: A Conditional Directional Distance Benefit-of-the-Doubt Model," Ecological Economics, Elsevier, vol. 139(C), pages 19-32.
    14. Karagiannis, Roxani & Karagiannis, Giannis, 2018. "Intra- and inter-group composite indicators using the BoD model," Socio-Economic Planning Sciences, Elsevier, vol. 61(C), pages 44-51.
    15. Simar, Leopold & Wilson, Paul W., 2007. "Estimation and inference in two-stage, semi-parametric models of production processes," Journal of Econometrics, Elsevier, vol. 136(1), pages 31-64, January.
    16. Sahoo, Biresh K. & Singh, Ramadhar & Mishra, Bineet & Sankaran, Krithiga, 2017. "Research productivity in management schools of India during 1968-2015: A directional benefit-of-doubt model analysis," Omega, Elsevier, vol. 66(PA), pages 118-139.
    17. Gulati, Rachita & Kattumuri, Ruth & Kumar, Sunil, 2020. "A non-parametric index of corporate governance in the banking industry: An application to Indian data," Socio-Economic Planning Sciences, Elsevier, vol. 70(C).
    18. Arocena, Pablo & Saal, David S. & Urakami, Takuya & Zschille, Michael, 2020. "Measuring and decomposing productivity change in the presence of mergers," European Journal of Operational Research, Elsevier, vol. 282(1), pages 319-333.
    19. Zanella, Andreia & Camanho, Ana S. & Dias, Teresa G., 2015. "Undesirable outputs and weighting schemes in composite indicators based on data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 245(2), pages 517-530.
    20. Färe, Rolf & Karagiannis, Giannis & Hasannasab, Maryam & Margaritis, Dimitris, 2019. "A benefit-of-the-doubt model with reverse indicators," European Journal of Operational Research, Elsevier, vol. 278(2), pages 394-400.
    21. C A K Lovell & A P B Rouse, 2003. "Equivalent standard DEA models to provide super-efficiency scores," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 54(1), pages 101-108, January.
    22. Fátima Pérez & Laura Delgado-Antequera & Trinidad Gómez, 2019. "A Two-Phase Method to Assess the Sustainability of Water Companies," Energies, MDPI, vol. 12(13), pages 1-19, July.
    23. Sahoo, Biresh & Singh, Ramadhar & Mishra, Bineet & Sankaran, Krithiga, 2015. "Research Productivity in Management Schools of India: A Directional Benefit-of-Doubt Model Analysis," MPRA Paper 67046, University Library of Munich, Germany.
    24. Rogge, Nicky, 2012. "Undesirable specialization in the construction of composite policy indicators: The Environmental Performance Index," Working Papers 2012/08, Hogeschool-Universiteit Brussel, Faculteit Economie en Management.
    25. Chen, Yao, 2005. "Measuring super-efficiency in DEA in the presence of infeasibility," European Journal of Operational Research, Elsevier, vol. 161(2), pages 545-551, March.
    26. Liu, Junqing & Fukushige, Mototsugu, 2020. "Efficiency and pricing of water supply and sewerage services in Japan," Utilities Policy, Elsevier, vol. 62(C).
    27. Marques, Rui Cunha, 2006. "A yardstick competition model for Portuguese water and sewerage services regulation," Utilities Policy, Elsevier, vol. 14(3), pages 175-184, September.
    28. Dyson, R. G. & Allen, R. & Camanho, A. S. & Podinovski, V. V. & Sarrico, C. S. & Shale, E. A., 2001. "Pitfalls and protocols in DEA," European Journal of Operational Research, Elsevier, vol. 132(2), pages 245-259, July.
    29. Seiford, Lawrence M. & Zhu, Joe, 2002. "Modeling undesirable factors in efficiency evaluation," European Journal of Operational Research, Elsevier, vol. 142(1), pages 16-20, October.
    30. Corrado Lo Storto, 2018. "Efficiency, Conflicting Goals and Trade-Offs: A Nonparametric Analysis of the Water and Wastewater Service Industry in Italy," Sustainability, MDPI, vol. 10(4), pages 1-22, March.
    31. Cazals, Catherine & Florens, Jean-Pierre & Simar, Leopold, 2002. "Nonparametric frontier estimation: a robust approach," Journal of Econometrics, Elsevier, vol. 106(1), pages 1-25, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Julián Martinez-Moya & Amparo Mestre-Alcover & Ramon Sala-Garrido, 2024. "Connectivity and competitiveness of the major Mediterranean container ports using ‘Benefit-of-the-Doubt’ and ‘Common Sets of Weights’ methods in Data Envelopment Analysis," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 26(2), pages 261-282, June.
    2. Vilarinho, Hermilio & Pereira, Miguel Alves & D’Inverno, Giovanna & Nóvoa, Henriqueta & Camanho, Ana S., 2024. "Water Utility Service Quality Index: A customer-centred approach for assessing the quality of service in the water sector," Socio-Economic Planning Sciences, Elsevier, vol. 92(C).
    3. Tourinho, Marco & Santos, Paulo Rosa & Pinto, Francisco Taveira & Camanho, Ana S., 2022. "Performance assessment of water services in Brazilian municipalities: An integrated view of efficiency and access," Socio-Economic Planning Sciences, Elsevier, vol. 79(C).
    4. Walheer, Barnabé, 2024. "A sequential benefit-of-the-doubt composite indicator," European Journal of Operational Research, Elsevier, vol. 316(1), pages 228-239.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Vilarinho, Hermilio & D’Inverno, Giovanna & Nóvoa, Henriqueta & Camanho, Ana S., 2023. "The measurement of asset management performance of water companies," Socio-Economic Planning Sciences, Elsevier, vol. 87(PA).
    2. Mergoni, Anna & D'Inverno, Giovanna & Carosi, Laura, 2022. "A composite indicator for measuring the environmental performance of water, wastewater, and solid waste utilities," Utilities Policy, Elsevier, vol. 74(C).
    3. Vilarinho, Hermilio & D’Inverno, Giovanna & Nóvoa, Henriqueta & Camanho, Ana S., 2023. "Performance analytics for regulation in retail water utilities: Guiding asset management by identifying peers and targets," Utilities Policy, Elsevier, vol. 82(C).
    4. Fusco, Elisa & Vidoli, Francesco & Sahoo, Biresh K., 2018. "Spatial heterogeneity in composite indicator: A methodological proposal," Omega, Elsevier, vol. 77(C), pages 1-14.
    5. Fusco, Elisa & Vidoli, Francesco & Rogge, Nicky, 2020. "Spatial directional robust Benefit of the Doubt approach in presence of undesirable output: An application to Italian waste sector," Omega, Elsevier, vol. 94(C).
    6. Rogge, Nicky & Archer, Geoffrey, 2021. "Measuring and analyzing country change in establishing ease of doing business using a revised version of World Bank's ease of doing business index," European Journal of Operational Research, Elsevier, vol. 290(1), pages 373-385.
    7. An, Qingxian & Tao, Xiangyang & Chen, Xiaohong, 2023. "Nested frontier-based best practice regulation under asymmetric information in a principal–agent framework," European Journal of Operational Research, Elsevier, vol. 306(1), pages 269-285.
    8. Emrouznejad, Ali & De Witte, Kristof, 2010. "COOPER-framework: A unified process for non-parametric projects," European Journal of Operational Research, Elsevier, vol. 207(3), pages 1573-1586, December.
    9. Rogge, Nicky & De Jaeger, Simon & Lavigne, Carolien, 2017. "Waste Performance of NUTS 2-regions in the EU: A Conditional Directional Distance Benefit-of-the-Doubt Model," Ecological Economics, Elsevier, vol. 139(C), pages 19-32.
    10. Juan Aparicio & Magdalena Kapelko & Juan F. Monge, 2020. "A Well-Defined Composite Indicator: An Application to Corporate Social Responsibility," Journal of Optimization Theory and Applications, Springer, vol. 186(1), pages 299-323, July.
    11. D’Inverno, Giovanna & Carosi, Laura & Romano, Giulia, 2021. "Environmental sustainability and service quality beyond economic and financial indicators: A performance evaluation of Italian water utilities," Socio-Economic Planning Sciences, Elsevier, vol. 75(C).
    12. Kristof De Witte & Rui Marques, 2010. "Designing performance incentives, an international benchmark study in the water sector," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 18(2), pages 189-220, June.
    13. Henriques, Alda A. & Camanho, Ana S. & Amorim, Pedro & Silva, Jaime G., 2020. "Performance benchmarking using composite indicators to support regulation of the Portuguese wastewater sector," Utilities Policy, Elsevier, vol. 66(C).
    14. Pereira, Miguel Alves & Camanho, Ana Santos & Figueira, José Rui & Marques, Rui Cunha, 2021. "Incorporating preference information in a range directional composite indicator: The case of Portuguese public hospitals," European Journal of Operational Research, Elsevier, vol. 294(2), pages 633-650.
    15. De Witte, Kristof & Schiltz, Fritz, 2018. "Measuring and explaining organizational effectiveness of school districts: Evidence from a robust and conditional Benefit-of-the-Doubt approach," European Journal of Operational Research, Elsevier, vol. 267(3), pages 1172-1181.
    16. Marc Aliana & Diego Prior & Emili Tortosa-Ausina, 2024. "Assessing the impact of environmental factors on emergency healthcare quality: Implications for budget allocation," Working Papers 2024/04, Economics Department, Universitat Jaume I, Castellón (Spain).
    17. Alda A. Henriques & Milton Fontes & Ana S. Camanho & Giovanna D’Inverno & Pedro Amorim & Jaime Gabriel Silva, 2022. "Performance evaluation of problematic samples: a robust nonparametric approach for wastewater treatment plants," Annals of Operations Research, Springer, vol. 315(1), pages 193-220, August.
    18. Cordero Ferrera, Jose Manuel & Alonso Morán, Edurne & Nuño Solís, Roberto & Orueta, Juan F. & Souto Arce, Regina, 2013. "Efficiency assessment of primary care providers: A conditional nonparametric approach," MPRA Paper 51926, University Library of Munich, Germany.
    19. D’Inverno, Giovanna & De Witte, Kristof, 2020. "Service level provision in municipalities: A flexible directional distance composite indicator," European Journal of Operational Research, Elsevier, vol. 286(3), pages 1129-1141.
    20. D'Inverno, Giovanna & Moesen, Wim & De Witte, Kristof, 2022. "Local government size and service level provision. Evidence from conditional non-parametric analysis," Socio-Economic Planning Sciences, Elsevier, vol. 81(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:soinre:v:155:y:2021:i:1:d:10.1007_s11205-020-02588-1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.