Managerial ownership and urban water utilities efficiency in Uganda

This paper assesses the impact of the early 1980s neoliberalistic reform strategies in urban water distribution in developing countries. It examines in particular, the technical efficiency of two heterogeneous urban water utility-groups in Uganda. Performance is considered in light of the key urban water sector objectives that are to universally increase qualitative water coverage and enhance utility revenue. Using a two-staged bias-corrected metafrontier based on the data envelopment analysis estimators, the public-private (than the public-public) owned utilities are found less efficient. Efficiency differences between both groups are further linked to utilities scale of operation and market capture capabilities among other factors. The paper urges policy makers to strengthen public sector capabilities as a development policy solution for inclusive quality water services access among other basic public utility services in Uganda, Africa and the developing countries in general.

Keywords: Efficiency, managerial ownership, non-parametric, Uganda, urban water supply.

JEL classification: C14, H41, L95, Q25