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Public Versus Private Water Utilities: Empirical Evidence for Brazilian Companies

2005; Springer Nature; Volume: 8; Issue: 2 Linguagem: Inglês

1545-2921

Tito Belchior Silva Moreira, Geraldo da Silva e Souza, Ricardo Coelho de Faria,

Water resources management and optimization

This paper compares the technical efficiency of Brazilian public and private companies in water supply. To measure efficiency a stochastic production frontier model is estimated using two competitive distributions for the inefficiency error component: truncated normal and exponential. The exponential distribution showed a superior fit and was used to assess differences in technical efficiency between public and private companies. The statistical results show that private companies are only marginally more efficient than public ones.