The Value of Household Water Service Quality in Lahore,Pakistan |
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Authors: | Agha Ali Akram Sheila M Olmstead |
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Institution: | (1) Department of Environmental Management, Faculty of Environmental Studies, Universiti Putra Malaysia, Serdang, Selangor, Malaysia |
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Abstract: | Most existing literature focuses on the benefits of establishing basic drinking water access for unserved populations, the
extensive water supply margin. In contrast, this article examines the intensive margin—the benefits of improving water service
to under-served households, a growing population in developing country cities. We use contingent valuation to estimate willingness
to pay (WTP) for improved piped water quality and reductions in supply interruptions among a sample of 193 households in Lahore,
Pakistan. The distribution of WTP is described using parametric and non-parametric models. Results indicate that households
in Lahore are willing to pay about 7.50 to7.50 to 9 per month for piped water supply that is clean and drinkable directly from
the tap—comparable to the monthly cost of in-home water treatment, and about three to four times the average monthly water
bill for sample households using piped water. Estimates of WTP for reducing supply interruptions are both smaller and more
difficult to interpret, since a significant fraction of the estimated WTP distribution for supply improvements is negative.
All of our WTP estimates are well below 4% of monthly household income, the World Bank’s benchmark upper bound for affordable
water service. |
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Keywords: | |
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