|||T<br>|able 1: Summar<br>|yof data set<br>|||
|---|---|---|---|---|---|---|
||**Countries with**<br>**an autonomous**<br>**water regulatory**<br>**agency**|**Countries**<br>**with PPP**|**Countries with**<br>**both an**<br>**autonomous**<br>**regulator and**<br>**PPP**<br>**Full Sample(177**|**Countries with**<br>**PPP but no**<br>**autonomous**<br>**regulatory**<br>**agency**<br>**countries)**|**Countries with an**<br>**autonomous**<br>**regulatory agency**<br>**but no PPP**|**Countries with**<br>**no autonomous**<br>**regulatory**<br>**agency and no**<br>**PPP**|
|**Number**<br>|80<br>|157<br>|69<br>|89<br>|11<br>|8<br>|
|**Share(in %)**|45.2|88.7|39.0|50.3|6.2|4.5|
|||**Develo**<br>|**ping country sam**<br>|**ple(123 countries)**<br>|||
|**Number**|55|108|48|60|7|8|
|**Share(in %)**|44.7|87.8|39.0|48.8|5.7|6.5|
|||**Devel**<br>|**oped country sam**<br>|**ple(54 countries)**<br>|||
|**Number**|25|49|21|29|4|0|
|**Share(in %)**|46.3|90.7|38.9|53.7|7.4|0.0|

**Source: Based on data collection by the authors**

The table shows that, while 88.7% of the countries of this very large sample have some type of PPP, only 45.2% rely on the existence of a sector regulator. The proportions are roughly similar across country groups at this very high level of aggregation. When matching the existence of any PPP and the existence of an IRA, the shares drop to less than 40% and once more there is not much difference between the two country groups. Very roughly, one out of two countries with a PPP has no IRA. As expected somehow given the differences in risk levels to investors, it seems somewhat easier for developed countries to attract PPPs without IRAs. There are also a number of countries in which the sector has not relied on any PPP but has adopted the IRA model, less than 6% for developed economies and less than 8% for developing ones. The differences are somewhat stronger for the groups of countries with PPP but no agencies. Finally, in our sample of 54 developed economies, there is no instance of countries without an IRA and without a PPP jointly.

This very basic data analysis already points to the uncertainty of the size and sign of the correlation between the existence of an IRA and any experience with PPP. But there are clearly other factors that will drive the outcome and the extent to which an IRA may help or not access to PPP. These differences may actually be quite important in the context of developing countries since the initial conditions on core water market characteristics are likely to differ. Coverage is indeed not yet universal for the water sector and even less so for sanitation. The ability to pay also varies across countries, reflecting wide differences in income per capita. Institutional differences are also likely to influence the supply of PPP since it drives the levels of risks for investors.

The initial conditions of the sector are approximated by the access rates available from the World Development Indicators database and the quality of the governance of the sector. Institutional quality is approximated by three types of indictors: a regulatory quality indicator, a rule of law indicator and the control of corruption approximated by the ratings provided by the World Bank Governance Indicators. These indicators run from ‐2.5 to 2.5, with higher values corresponding to better governance for each country. We also consider the possible relevance of the extent to which water regulation is decentralized based on a survey produced by the OECD (2016). Because we are interested in the supply of private capital, it seems reasonable to include a price variable. We approximate this driver of supply by the inflation rate. Finally, we considered the possibility of patterns of differences across regions in their ability to attract PPP since the World Bank PPP database clearly points to a very strong comparative advantage of Latin America and Asia in the ability to do so. This is included as a regional dummy variable in the model discussed later. Finally, we account for the income per capita in the country since it provides a sense of the extent to which the ability to pay may influence the 6