Proceedings of The 14th International Conference on Management, Economics and Humanities
Why (not) to pay for Safe Drinking Water? Experimental Evidence from Uganda
Femke Maes, Bart Defloor
Lack of access to potable water is one of the greatest challenges for rural regions in developing countries. Particularly in Sub-Saharan Africa (SSA), deprivation of potable water imposes a high health and time burden on mainly women and children. Improving access to potable water is therefore an important goal for policymakers and development aid. However, as resources are scarce, accurately analysing the costs and benefits of drinking water policies by analysing households’ preferences for potable water, is of utter importance.
Method. This study analyses households’ preferences for potable water in rural Western Uganda. A contingent valuation survey is used to elicit their willingness to pay and its determinants. In total 360 households were surveyed and a water sample was taken from the water storage containers of their dwellings. Special attention for the inclusion of women’s perspectives, since women are traditionally more involved in water related tasks though often neglected in research, is ensured throughout the research process.
Results. Overall, we find that the water quality in the houses is poor. 90% of the samples contain E. coli, which stresses the urgent need for potable water (1). In line with this, the mean willingness to pay for potable water is estimated at 167 Ugandan Shilling per jerrycan of 20 litres, which is 67 Shilling higher than the current Ugandan market price (2). Whether the households decide to pay for potable water is determined by the price offered, the gender of the household head, the household size, subjective welfare and levels of schooling. However, we find no effect of the distribution of household decision power, institutional trust, health status or perceived water quality on the purchasing decision (3). The number of jerrycans a household is willing to pay mainly depends on the price and the household size. A 1% increase in the price is expected to decrease the amount of jerrycans bought by one household in one week by 5%. A 12% increase in the amount of jerrycans bought, is expected when the household counts one member more (4).
Discussion. The validity of the obtained estimates is critically reflected upon by comparing them with real market data.
keywords: Willingness to pay, Drinking Water, Field Experiment, Uganda