Social policy, regulation and private sector water supply: the case of Colombia

Abstract

This paper investigates the impact of PSP on the poor in the Colombian water sector in terms of access, continuity of service and affordability. Overall, the results indicate that PSP in the Colombian water sector has had a strong and positive impact on the poor as far as continuity of service is concerned; which is crucial for effective water supply to the poor. We also find a positive effect on sewerage connection rates among the poor. The evidence is less robust for piped water connection rates, where PSP either had a positive or neutral effect on connection rates among the poor. As regards affordability of service there is no statistically significant effect of PSP. This last result may be associated with the particular water subsidy scheme used in Colombia. In turn, this points to the importance of complementary social policies as a way to mitigate the impact of reform on the poor.