Privatization and Renationalization: What went wrong in Bolivia's water sector?

Privatization and Renationalization: What went wrong in Bolivia's water sector?

July 3, 2013


NOTE: This paper is made available for sale on the following website:
http://www.sciencedirect.com/science/article/pii/S0305750X12001544
Copyright 2012 Elsevier Ltd. All rights reserved.

This paper investigates the impact of water service privatization in Bolivia. It compares the performance of cities in which the service was privatized (La Paz and El Alto) with a city in which it is managed as a cooperative (Santa Cruz de la Sierra) and one where the service is publicly provided (Cochabamba). We find that access to water by low-income consumers increased under private provision. However, the concessionaire failed to meet the targets stipulated in the contract. The tariff increases required for full cost recovery eventually led to public outrage that forced the government to renationalize the company.

Please note this paper which was co-authored by UNDP is available for sale on the Science Direct website.