Economies of integration and sources of change in productivity in the Chilean water and sewerage industry: a translog cost function approach

Maziotis, Alexandros; Molinos-Senante, Maria

Abstract

This paper researches the existence of economies of scale and scope in the Chilean water and sewerage industry using a translog cost function approach over the period 2010-2017. It also provides estimates of productivity growth and its determinants, technical change and scale effect. The results suggest that on average, the water industry operates under increasing economies of scale, which implies that further increases in water companies' scale of operations may be cost beneficial. Economies of scope between water and sewerage services were found for the average company, which suggests that the joint provision of these services may lead to cost savings. An average annual productivity increase of 2.5% was reported with scale effect being the major driver. Full private companies performed better than concessionary and public water companies. The results of our study can be of greater interest to the policy-makers who want to make decisions on introducing policy reforms such as mergers, unbundling of the water and sewerage supply chain, or developing incentives to improve companies' productivity.

Más información

Título según WOS: Economies of integration and sources of change in productivity in the Chilean water and sewerage industry: a translog cost function approach
Título de la Revista: ENVIRONMENTAL SCIENCE AND POLLUTION RESEARCH
Volumen: 29
Número: 6
Editorial: SPRINGER HEIDELBERG
Fecha de publicación: 2022
Página de inicio: 8503
Página final: 8513
DOI:

10.1007/s11356-021-15851-w

Notas: ISI