Effective demand for safer and more reliable water supply in low- and middle-income countries : evidence from urban Bangladesh and rural Uganda

Access to drinking water infrastructure in low- and middle-income countries (LMICs) has increased over the last 30 years, but much of that infrastructure functions intermittently, provides water of poor quality, or fails prematurely. Financing for the recurrent costs of delivering truly safe and reliable water supply is far lower than needed. This dissertation contributes to understanding the extent to which water users' willingness and ability to pay (their 'effective demand') over time for innovative, community-level water supply improvements that obviate individual behavior change could fill this financial gap. It does so by measuring effective demand and its determinants for real water supply improvements delivered as subscription services in exchange for real money payments. Two price experiments and one simulation were conducted in contexts where safer and more reliable water supply is urgently needed: urban South Asia and rural Africa. Each study involved collecting data in the field over five months to two years. First, 196 landlords of rental housing in Dhaka, Bangladesh were offered a passive, in-line chlorination service at various prices using Becker-DeGroot-Marschak (BDM) auctions. Second, a Monte Carlo simulation was developed to estimate the effect of Dhaka residents' aversion to chlorine taste on their choice of water supply and subsequent exposure to microbiological and disinfection byproduct contamination. Third, 113 community water committees across two districts in rural Uganda were offered a professional handpump maintenance and repair service at various prices, also using BDM auctions. The in-line chlorination and handpump services were delivered successfully and satisfied most of their customers. Nonetheless, effective demand for both services decreased over time and was insufficient to recover a meaningful share of their operational expenses at the scale of study. There was little evidence that landlords in Dhaka and water committees in Uganda responded to economic incentives hypothesized to make the services especially attractive to them. Notably, some determinants of demand for different stages in the process of acquiring and sustaining the water supply improvements differed within and across contexts. The Monte Carlo simulation suggests that chlorine taste aversion changes the expected relationship between the chlorine dose used in point-of-use (household-level) water treatment and subsequent contaminant exposure. Instead of higher doses reducing microbiological exposure and increasing disinfection byproduct exposure, simulated exposure to fecal indicator bacteria was minimized at a chlorine dose of 0.5 mg/L; disinfection byproduct exposure was maximized at doses of 1-2 mg/L. Doses lower than the 2 mg/L typically recommended for point-of-use treatment likely reduce exposure to both types of contaminants by avoiding the rejection of treated water due to excessive chlorine taste. This dissertation makes several contributions to the scholarship of drinking water supply development. First, it conceptualizes sustaining water supply improvements as a process through which water users' effective demand, and the determinants of their demand, may change. Applying this concept suggests that even experimental revealed preference studies overestimate the long-term demand needed to sustain water supply improvements, especially among low-income populations. Second, in contrast to recent contentions based on stated preference studies, no evidence was found that the prospect of increasing handpump reliability encourages consistent payments from water users in rural Africa. Third, it provides the first analysis of the effect of human behavior on the tradeoff between exposure to microbiological contamination and disinfection byproducts. The key implication of my findings is that, even in 'best-case' scenarios of demand-responsive innovation and implementation fidelity, effective demand among water users is insufficient to finance the operation and maintenance costs, let alone the amortized capital costs, of achieving the global goal of universal access to safe water by the year 2030. In response, I call for greater scholarly emphasis on financial support for operation and maintenance from institutions above the community level. Several other areas for future research can build on my methods and findings. Research that does focus on water users' effective demand for improvements should measure it over time, as its magnitude and determinants may change and be inaccurately indicated by stated preference methods. Elucidating the conditions under which consolidating community-managed water supplies into utilities could enhance water supply services would be especially timely. Future experiments should also test how long it takes diverse populations using different types of water supplies to become habituated to the taste and odor of chlorinated water

Advisor: Davis Jenna (Professor)
Boehm Alexandria
Luby Stephen
Mitch William A.