Does Greater Autonomy Improve Performance? Evidence from Water Service Providers in Indian Cities

Centre for Development Economics, Department of Economics, Delhi School of Economics Working Paper No. 205

24 Pages Posted: 19 Dec 2012

See all articles by Shreekant Gupta

Shreekant Gupta

Lee Kuan Yew School of Public Policy; University of Delhi - Delhi School of Economics

Surender Kumar

University of Delhi - Department of Business Economics

Gopal K. Sarangi

TERI University

Date Written: October 25, 2011

Abstract

We assess the efficiency of urban water supply in 27 Indian cities using data envelopment analysis (DEA). We also group cities by the management structure of their water utilities. Utilities with greater degree of functional autonomy perform better, supporting the hypothesis that more autonomy in management leads to better performance among water utilities. Our results also have implications for urban domestic water pricing -- most of the utilities operate under decreasing returns to scale (DRS) implying water should be priced at marginal cost of supply.

Keywords: water supply, India, data envelopment analysis (DEA)

JEL Classification: L95, L38, C14, H70

Suggested Citation

Gupta, Shreekant and Gupta, Shreekant and Kumar, Surender and Sarangi, Gopal K., Does Greater Autonomy Improve Performance? Evidence from Water Service Providers in Indian Cities (October 25, 2011). Centre for Development Economics, Department of Economics, Delhi School of Economics Working Paper No. 205, Available at SSRN: https://ssrn.com/abstract=2191027 or http://dx.doi.org/10.2139/ssrn.2191027

Shreekant Gupta

Lee Kuan Yew School of Public Policy ( email )

469C Bukit Timah Road
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Singapore, 259772
Singapore

HOME PAGE: http://www.spp.nus.edu.sg/Faculty_Shreekant_Gupta.aspx

University of Delhi - Delhi School of Economics ( email )

Department of Economics
University of Delhi
Delhi, Delhi 110007
India
91-11-27667005 (Phone)
91-11-27667159 (Fax)

HOME PAGE: http://www.du.ac.in/index.php?id=270&fmember=2728&cid=260

Surender Kumar (Contact Author)

University of Delhi - Department of Business Economics ( email )

New Dehli
India

Gopal K. Sarangi

TERI University ( email )

New Delhi
India

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