Preprint Article Version 1 Preserved in Portico This version is not peer-reviewed

Governance and Efficiency in Brazilian Water Utilities: An Analysis from Revenue Collection Efficiency

Version 1 : Received: 3 June 2024 / Approved: 3 June 2024 / Online: 3 June 2024 (15:35:05 CEST)

How to cite: Barbosa, A.; Medeiros, F. A. S. D.; Simões, P. Governance and Efficiency in Brazilian Water Utilities: An Analysis from Revenue Collection Efficiency. Preprints 2024, 2024060109. https://doi.org/10.20944/preprints202406.0109.v1 Barbosa, A.; Medeiros, F. A. S. D.; Simões, P. Governance and Efficiency in Brazilian Water Utilities: An Analysis from Revenue Collection Efficiency. Preprints 2024, 2024060109. https://doi.org/10.20944/preprints202406.0109.v1

Abstract

This study analyzes the relevance of governance structure for efficiency in revenue collection by Brazilian Water Utilities (WUs). Data was collected from the National Information System on Sanitation (SNIS) for 127 Brazilian WUs, covering a balanced longitudinal panel from 2018 to 2022. Governance structures evaluated included Ownership (public or private) and Corporatization (publicly traded or not). In scientific databases, we did not find studies on the efficiency of specific WUs in collecting customer bills for services rendered and its relationships with this type of governance; thus, this would be the main innovative contribution of the study to the previous literature. In the first stage, the study utilized the Dynamic Slack Based Model (DSBM) to assess revenue collection efficiency. In the second stage, an econometric model with Generalized Estimating Equations (GEE) to explain the efficiency. The findings revealed a global average inefficiency of 50.47% in revenue collection. Corporatization was linked to higher collection efficiencies, while ownership type was significant, but with lower collection efficiency. Factors such as tariff accessibility, urbanization, and the COVID-19 pandemic also influenced efficiency. The study suggests regulatory bodies should consider these insights to implement policies that prevent inefficiencies from affecting the tariff system for services.

Keywords

efficiency; water and wastewater services; governance structure; revenue collection; ownership

Subject

Business, Economics and Management, Business and Management

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