2002年-世界发展银行全球_How_Different_is_the_Efficiency_of_Public_and_Private_Water_Companies_in_Asia__10页_546kb

Summary of "How Different Is the Efficiency of Public and Private Water Companies in Asia?"

Core Content

This article investigates the efficiency of public and private water companies in the Asian and Pacific region, using a stochastic cost frontier approach with data from 1995. It builds on earlier studies from the United States that have produced conflicting results on whether public or private ownership leads to greater efficiency. The authors aim to contribute further evidence to this debate by analyzing a sample of 50 water companies across 29 countries.

Main Viewpoints

• No Significant Efficiency Difference: The study concludes that there is no statistically significant difference in efficiency between public and private water companies in Asia.
• Use of Stochastic Cost Frontier: The authors employ a stochastic cost frontier model, which accounts for both inefficiency and random noise in cost data, to estimate efficiency.
• Two Approaches to Efficiency Measurement: Two models are used—Error Components (EC) and Technical Efficiency Effects (TEE) models—to test the robustness of the findings.
• Ownership and Efficiency: The analysis suggests that the lack of conclusive evidence on efficiency differences may be due to the fact that competition has a greater impact than ownership type.
• Regulatory Implications: The study highlights the importance of moving from rate-of-return regulation to price or revenue-cap regulation to incentivize cost efficiency and benefit consumers.

Key Information

Data Overview

• The data comes from the Asian Development Bank (ADB) and covers 50 water companies in 29 countries.
• The data includes operational costs, labor salaries, number of clients, daily production, number of connections, population density, water sources, and metering levels.
• The data is limited to one year and lacks information on the asset base, which complicates the analysis of maintenance and operational costs.

Methodology

• A Cobb-Douglas cost function is used as the base specification due to its simplicity and the inability to reject the Cobb-Douglas hypothesis in the likelihood ratio test.
• The cost frontier is estimated using FRONTIER version 4.1, a program for stochastic frontier analysis.
• The model includes environmental variables such as population density, water source, and quality of service, which are not under the firm’s direct control but influence efficiency.

Models Used

Error Components (EC) Model

• This model assumes that the inefficiency term is distributed with a mean of zero.
• The estimated value of γ (the proportion of inefficiency in the total error) is 0.420, indicating that inefficiency is not the dominant factor.
• The null hypothesis (Ho: γ = 0) is not rejected, suggesting that the inefficiency effects are minimal.
• The EC model results show that the main cost drivers are labor costs, metered connections, and water availability, all of which have a positive and significant effect on costs.
• The average efficiency is 1.39, and the concession dummy variable has a negative but not significant effect.

Technical Efficiency Effects (TEE) Model

• This model allows the inefficiency term to have a mean m_i that is influenced by ownership and other variables.
• The average efficiency in the TEE model is 1.44, slightly higher than in the EC model.
• The concession dummy variable in the TEE model has a negative and non-significant effect, similar to the EC model.
• The ML estimates for both models suggest that private and public firms do not differ significantly in terms of efficiency.

Robustness of Results

• The results are consistent with earlier U.S. studies, reinforcing the idea that ownership type is not a strong determinant of efficiency.
• The OLS and ML estimates are very close, suggesting that noise dominates the inefficiency component.
• The study emphasizes that efficiency gains should be associated with cost reductions, not quality degradation, and both need to be measured to understand performance differences.

Conclusion

• The study finds no convincing evidence of a systematic efficiency advantage for either public or private water companies in Asia.
• It suggests that competition, rather than ownership, is a more critical factor in driving efficiency.
• The findings support the idea that yardstick competition can help minimize differences between public and private providers by focusing on cost efficiency while maintaining service quality.
• The authors note that the lack of detailed data on asset bases and capital costs limits the depth of the analysis but does not undermine the conclusion that efficiency differences are not significant.