Water and sanitation service delivery, pricing, and the poor: An empirical estimate of subsidy incidence in Nairobi, Kenya
Date
2016Author
Fuente, David
Gatua, Josephine G
Ikiara, Moses
Kabubo-Mariara, Jane
Mwaura, Mbutu
Whittington, Dale
Type
ArticleLanguage
enMetadata
Show full item recordAbstract
The increasing block tariff (IBT) is among the most widely used tariffs by water utilities, particularly in developing countries. This is due in part to the perception that the IBT can effectively target subsidies to low-income households. Combining data on households' socioeconomic status and metered water use, this paper examines the distributional incidence of subsidies delivered through the IBT in Nairobi, Kenya. Contrary to conventional wisdom, we find that high-income residential and non-residential customers receive a disproportionate share of subsidies and that subsidy targeting is poor even among households with a private metered connection. We also find that stated expenditure on water, a commonly used means of estimating water use, is a poor proxy for metered use and that previous studies on subsidy incidence underestimate the magnitude of the subsidy delivered through water tariffs. These findings have implications for both the design and evaluation of water tariffs in developing countries. This article is protected by copyright. All rights reserved.
Citation
Gakii Gatua, Josephine, et al. "Water and sanitation service delivery, pricing, and the poor: An empirical estimate of subsidy incidence in Nairobi, Kenya." Water Resources Research (2016).Publisher
University of Nairobi
Subject
water tariff;water pricing;increasing block tariff;subsidy targeting;water utilities;Nairobi;KenyaRights
Attribution-NonCommercial-NoDerivs 3.0 United StatesUsage Rights
http://creativecommons.org/licenses/by-nc-nd/3.0/us/Collections
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