Demand for Increased Water Reliability Among Urban Households in Jordan
*Names in bold indicate Presenter
This paper reports on the design and baseline survey results from an impact evaluation of an urban water infrastructure investment program being implemented in Zarqa, Jordan. The primary aim of the improvements is to increase incomes in Zarqa through reduced NRW and ameliorated water reliability, which in turn leads to cost savings and productivity gains among beneficiaries. A primary challenge for an evaluation of this type is to account for the non-random selection of neighborhoods for water network rehabilitation and sewer extension investments. Using census data, we implemented a propensity score matching procedure to identify observationally similar neighborhoods that will be differentially affected by the projected infrastructure improvements. Within matched zones, households were randomly selected for inclusion in the study. This design offers a practical approach to evaluation of complex and large infrastructure projects. It also fills an important gap in the literature on the economic benefits of water infrastructure.
Baseline data from our sample of 3468 households shows that households do not display statistically significant differences on a number of key variables. We then use these baseline data to estimate the social benefits to households of reliability improvements in Zarqa. We derive estimates of these social benefits using two methods: coping costs and contingent valuation willingness-to-pay (WTP) estimates. Coping costs refer to the costs of activities that households engage in to compensate for the unreliability and poor quality of existing water supplies. While 97% of our sample subscribes to WAJ services, a majority of households also purchase water from other water sources (e.g. water shops or water tankers). Coping costs include non-network water expenditures, collection time costs, storage costs, and water treatment costs. Baseline data shows that households in Jordan pay a high level of coping costs—on average, 7% of the monthly expenditures—implying potentially high social benefits from improving the network. However, contingent valuation WTP estimates imply a relatively low acceptability of increasing water tariff levels to obtain this increase in water reliability.