Hostname: page-component-848d4c4894-pjpqr Total loading time: 0 Render date: 2024-06-23T22:25:07.500Z Has data issue: false hasContentIssue false

Household preferences for municipal water services in Nicaragua

Published online by Cambridge University Press:  18 August 2011

William F. Vásquez
Affiliation:
Department of Economics, Fairfield University, 1073 North Benson Road, Fairfield, CT 06824, USA. Tel: 1-203-254-4000x2363. Fax: 1-203-254-4074. Email: wvasquez@fairfield.edu
Dina Franceschi
Affiliation:
Department of Economics, Fairfield University, USA. Email: dfranceschi@fairfield.edu
Gert T. Van Hecken
Affiliation:
Institute of Development Policy and Management, University of Antwerp, Belgium. Email: Gert.Vanhecken@ua.ac.be

Abstract

Choice models and a referendum format contingent valuation survey are used to investigate household preferences for improved water services and decentralization levels (actual departmental administration vs. further decentralization to the municipality) in urban Matiguás, Nicaragua. Choice models suggest that households prefer the current departmental administration over municipal provision for service and capacity, but believe that the municipality would be more interested in improving services. Results also indicate that households are willing to pay an increment of at least 112 per cent above their current monthly water bill for reliable and safe drinking water services, regardless of administration type.

Type
Research Article
Copyright
Copyright © Cambridge University Press 2011

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Ahmad, J., Devarajan, S., Khemani, S., and Shah, S. (2005), ‘Decentralization and service delivery’, World Bank Policy Research Working Paper 3603, World Bank, Washington, DC.Google Scholar
Anwandter, L. and Ozuna, T. (2002), ‘Can public sector reforms improve the efficiency of public water utilities?’, Environment and Development Economics 7: 687700.CrossRefGoogle Scholar
Arze, F.J. and Martinez-Vazquez, J. (2004), ‘Descentralización en América Latina desde una perspectiva de países pequeños: Bolivia, El Salvador, Ecuador y Nicaragua’, Gestión y Política Pública 13: 619661 [in Spanish].Google Scholar
Asthana, A. (2003), ‘Decentralisation and supply efficiency: the case of rural water supply in Central India’, Journal of Development Studies 39: 148159.CrossRefGoogle Scholar
Baisa, B., Davis, L., Salant, S., and Wilcox, W. (2010), ‘The welfare costs of unreliable water services’, Journal of Development Economics 92: 112.CrossRefGoogle Scholar
Bardhan, P. (2002), ‘Decentralization of governance and development’, Journal of Economic Perspectives 16: 185205.CrossRefGoogle Scholar
Bardhan, P. and Mookhejee, D. (2000), ‘Capture and governance at local and national levels’, American Economic Review 90: 135139.CrossRefGoogle Scholar
Bingham, L. (2006), ‘The new urban governance: processes for engaging citizens and stakeholders’, Review of Policy Research 23: 815826.CrossRefGoogle Scholar
Blaurock-Busch, E. (2009), ‘Bottled water: better than tap?’, The Original Internist 16: 6974.Google Scholar
Blumenschein, K., Blomquist, G., Johannesson, M., Horn, N., and Freeman, P. (2008), ‘Eliciting willingness to pay without bias: evidence from a field experiment’, Economic Journal 118: 114137.CrossRefGoogle Scholar
Cameron, T.A. (1988), ‘A new paradigm for valuing non-market goods using referendum data: maximum likelihood estimation by censored logistic regression’, Journal of Environmental Economics and Management 15: 355379.CrossRefGoogle Scholar
Caparros, A., Oviedo, J.R., and Campos, P. (2008), ‘Would you choose your preferred option? comparing choice and recoded ranking experiments’, American Journal of Agricultural Economics 90: 843855.CrossRefGoogle Scholar
Carlsson, F., Frykblom, P., and Lagerkvist, C.J. (2007), ‘Preference with and without prices: does the price attribute affect the stated preference surveys?’, Environmental and Resource Economics 38: 155164.CrossRefGoogle Scholar
Carson, R.T. and Groves, T. (2007), ‘Incentive and informational properties of preference questions’, Environmental and Resource Economics 37, 181210.CrossRefGoogle Scholar
Carson, R.T. and Hanemann, W.M. (2006), ‘Contingent valuation’, in Mäler, K.G. and Vincent, J.R. (eds), Handbook of Environmental Economics, Volume 2, North Holland: Elsevier, p. 821936.Google Scholar
Casey, J.F., Kahn, J.R., and Rivas, A. (2006), ‘Willingness to pay for improved water services in Manaus, Amazonas, Brazil’, Ecological Economics 58:365372.CrossRefGoogle Scholar
Champ, P.A., Bishop, R.C., Brown, T.C., and McCollum, D.W. (1997), ‘Using donation mechanisms to value nonuse benefits from public goods’, Journal of Environmental Economics and Management 33: 151162.CrossRefGoogle Scholar
CONAPAS (2005), ‘Estrategia sectorial de agua potable y saneamiento (2005–2015)’, Comisión Nacional de Agua Potable y Saneamiento (CONAPAS), Gobierno de Nicaragua, Nicaragua [in Spanish].Google Scholar
Ferrier, C. (2001), ‘Bottled water: understanding a social phenomenon’, Ambio 30: 118119.CrossRefGoogle Scholar
Goodrich, J., Adams, J., Lykins, B., and Clark, R. (1992), ‘Safe drinking water from small systems’, Journal of the American Water Works Association 84: 4955.CrossRefGoogle Scholar
Griffin, R.C. and Mjelde, J.W. (2000), ‘Valuing water supply reliability’, American Journal of Agricultural Economics 82: 414426.CrossRefGoogle Scholar
Groothuis, P.A., Groothuis, J.D., and Whitehead, J.C. (2007), ‘The willingness to pay to remove billboards and improve scenic amenities’, Journal of Environmental Management 85: 10941100.CrossRefGoogle ScholarPubMed
Herriges, J., Kling, C., Liu, C., and Tobias, J. (2010), ‘What are the consequences of consequentiality?’, Journal of Environmental Economics and Management 59: 6781.CrossRefGoogle Scholar
INIDE (Instituto Nacional de Información de Desarrollo) (2005), VIII Censo de población y IV de vivienda, [Available at] http://www.inide.gob.ni/censos2005/CifrasMun/Matagalpa/Matiguas.pdf.Google Scholar
Isham, J. and Kahkonen, S. (2002), ‘Institutional determinants of the impact of community-based water services: evidence from Sri Lanka and India’, Economic Development and Cultural Change 50: 667691.CrossRefGoogle Scholar
Krinsky, I. and Robb, A.L. (1986), ‘On approximating the statistical properties of elasticities’, Review of Economics and Statistics 68: 715719.CrossRefGoogle Scholar
Larson, A.M. (2002), ‘Natural resources and decentralization in Nicaragua: are local governments up to the job?’, World Development 30: 1731.CrossRefGoogle Scholar
Levard, L., López, Y. Marín, and Navarro, I. (2001), ‘Municipio de Matiguás: potenciales y limitantes del desarrollo agropecuario’, Cuadernos de Investigación, No. 11, Managua [in Spanish].Google Scholar
Morrison, M. and Brown, T.C. (2009), ‘Testing the effectiveness of certainty scales, cheap talk, and dissonance-minimization in reducing hypothetical bias in contingent valuation studies’, Environmental and Resource Economics 44: 307326.CrossRefGoogle Scholar
Nauges, C., Strand, J., and Walker, I. (2008), ‘The value of water connections in Central American cities: a revealed preference study’, Environment and Development Economics 14: 349370.Google Scholar
OECD (2003), Social Issues in the Provision and Pricing of Water Services, Paris: OECD Publishing.Google Scholar
Olmstead, S. (2003), ‘Water supply and poor communities: what's price got to do with it?’, Environment 45: 2235.Google Scholar
PAHO and ENACAL (2004), Analisis Sectorial de Agua Potable y Saneamiento de Nicaragua, Nicaragua: Panamerican Health Organization (PAHO) and Empresa Nacional de Acueductos y Alcantarillados (ENACAL) [in Spanish].Google Scholar
Pattanayak, S.K., Yang, J.C., Whittington, D., and Kumar, K.C. Bal (2005), ‘Coping with unreliable public water supplies: averting expenditures by households in Kathmandu, Nepal’, Water Resources Research 41, W02012; doi:10.1029/2003WR002443.CrossRefGoogle Scholar
Poe, G.L., Giraud, K.L., and Loomis, J.B. (2005), ‘Computational methods for measuring the difference of empirical distributions’, American Journal of Agricultural Economics 87: 353366.CrossRefGoogle Scholar
Prasad, N. (2006), ‘Privatisation results: private sector participation in water services after 15 years’, Development Policy Review 24: 669692.CrossRefGoogle Scholar
Prüss-Üstün, A., Kay, D., Fewtrell, L., and Bartram, J. (2004), ‘Unsafe water, sanitation and hygiene’, in Ezzati, M., Lopez, A.D., Rodgers, A. and Murray, C.J.L. (eds), Global and Regional Burden of Diseases Attributable to Selected Major Risk Factors, Geneva: World Health Organization.Google Scholar
Rodriguez-Pose, A., Tijmstra, S.A., and Bwire, A. (2009), Fiscal decentralisation, efficiency, and growth’, Environment and Planning A 41: 20412062.CrossRefGoogle Scholar
Rojas, F. (2000), ‘The political context of decentralization in Latin America: accounting for the particular demands of decentralization in the region’, in Burki, S.J. and Perry, G.E. (eds), Annual World Bank Conference on Development in Latin America and the Caribbean, Washington, DC: World Bank.Google Scholar
Rosado, M.A., Cunha-e-sá, M.A., Ducla-Soares, M., and Nunes, L.C. (2006), ‘Combining averting behavior and contingent valuation data: an application to drinking water treatment in Brazil’, Environment and Development Economics 11: 729746.CrossRefGoogle Scholar
Rosales, M. and Carmona, S. Valencia (2008), ‘Latin America’, in Decentralization and Local Democracy in the World, Barcelona: United Cities and Local Governments and World Bank.Google Scholar
Rouse, M. (2007), Institutional Governance and Regulation of Water Services: The Essential Elements, London: IWA Publishing.Google Scholar
Soto Montes de Oca, G. and Bateman, I.J. (2006), ‘Scope sensitivity in households’ willingness to pay for maintained and improved water supplies in a developing world urban area: investigating the influence of baseline supply quality and income distribution upon stated preferences in Mexico City’, Water Resources Research 42, W07421; doi:10.1029/2005WR003981.CrossRefGoogle Scholar
Strand, J. and Walker, I. (2005), ‘Water markets and demand in Central American cities’, Environment and Development Economics 10: 313335.CrossRefGoogle Scholar
UNDP (2006), Human Development Report, New York: United Nations Development Program.Google Scholar
Van Hecken, G. and Bastiaensen, J. (2009), ‘The potential and limitations of markets and payments for ecosystem services in protecting the environment: critical reflections inspired by an assessment of the RISEMP program in Matiguás-Río Blanco, Nicaragua’, IDPM-UA Discussion Paper 2009–02, Institute of Development Policy and Management, Antwerp.Google Scholar
Vásquez, W.F., Mozumder, P., Hernández Arce, J., and Berrens, R.P. (2009), ‘Willingness to pay for safe drinking water: evidence from Parral, Mexico’, Journal of Environmental Management 90: 33913400.CrossRefGoogle ScholarPubMed
Vossler, C.A., Ethier, R.G., Poe, G.L., and Welsh, M.P. (2003), ‘Payment certainty in discrete choice contingent valuation responses: results from a field validity test’, Southern Economic Journal 69: 886902.Google Scholar
Whitehead, J.C. (1995), ‘Willingness to pay for quality improvements: comparative statics and interpretation of contingent valuation results’, Land Economics 71: 207215.CrossRefGoogle Scholar
Whittington, D. (1998), ‘Administering contingent valuation surveys in developing countries’, World Development 26: 2130.CrossRefGoogle Scholar
Whittington, D. (2002), ‘Improving the performance of contingent valuation studies in developing countries’, Environmental and Resource Economics 22: 323367.CrossRefGoogle Scholar
Whittington, D. (2004), ‘Ethical issues with contingent valuation surveys in developing countries: a note on informed consent and other concerns’, Environmental and Resource Economics 28: 507515.CrossRefGoogle Scholar
World Bank (1993), ‘The demand for water in rural areas: determinants and policy implications’, World Bank Research Observer 8: 4770.CrossRefGoogle Scholar
World Bank (2003), World Development Report 2004: Making Services Work for the Poor People, Washington, DC: World Bank and Oxford University Press.Google Scholar
World Bank (2008), Nicaragua: Informe sobre la Pobreza 1993–2005, Informe No. 39736-NI, Washington DC: World Bank.Google Scholar