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To pay or not to pay? Water bill and delay in payment in Bejaia (Algeria): A duration analysis

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  • Kertous, Mourad
  • Zerzour, Sahad

Abstract

Efficient water management does not only involve effective water treatment and delivery to customer but also efficient billing and payment system to ensure financial sustainability. Delays in water bills payment are recognized as a major problem in developing countries but the reasons explaining these situations are scarcely addressed in the literature. To our knowledge, this paper is the first to address this issue.This article addresses this topic with Algeria as a case study. In this context, we identified from a literature review the factors that could affect time to water bill payment and we analyzed the effect of these factors on the time to bill payments through a Kaplan Meyer survival estimates approach. We applied this approach to two datasets, one including 27,363 household subscribers of Algerienne Des Eaux Company (ADE-Bejaia) located in Bejaia city and a second one that we collected in August 2008 made of 172 subscribers. Our results show that price is an explanatory factor in payment delays. A 10% increase in the average price generates a 4.8% increase in the average time to payment. In addition to economic factors, users’ dissatisfaction about service quality is a key element in our model.

Suggested Citation

  • Kertous, Mourad & Zerzour, Sahad, 2015. "To pay or not to pay? Water bill and delay in payment in Bejaia (Algeria): A duration analysis," MPRA Paper 67801, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:67801
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    References listed on IDEAS

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    1. Marquez Ragonesi Fernanda & Diaz Campo Cecilia & Danon Alejandro & Kestelman Borges Mariana & Gars Jared, 2024. "Timing matters: exploring the causal effect and potential mechanisms of a liquidity shock on delayed payments," Asociación Argentina de Economía Política: Working Papers 4743, Asociación Argentina de Economía Política.
    2. Vásquez, William F. & Alicea-Planas, Jessica, 2017. "Factors associated with nonpayment behavior in the water sector of Nicaragua," Utilities Policy, Elsevier, vol. 47(C), pages 50-57.

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    More about this item

    Keywords

    Determinants; payment delays; water demand; Algeria;
    All these keywords.

    JEL classification:

    • Q21 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Demand and Supply; Prices
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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