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The cost efficiency of water utilities: when does public ownership matter?

Pazzi, Silvia; Tortosa-ausina, Emili; Duygun, Meryem; Zambelli, Simona


Silvia Pazzi

Emili Tortosa-ausina

Aviva Chair in Risk and Insurance

Simona Zambelli


This study explores the impact of different ownership types on the efficiency of water utilities. Theories and evidence have shown a puzzling relationship between ownership and performance. Moreover, relatively recent contributions (Andrews et al. 2011) have argued that this relationship can be further convoluted by the effect of organisational and environmental variables. The current study aims to contribute to this literature by providing some empirical evidence for Italy, by proposing a methodology that combines non-parametric efficiency estimation and cluster analysis. Our main findings indicate that privately owned utilities indirectly controlled by a public organisation reach the highest level of efficiency but, when size and geographical location enter the analysis, ownership has a stronger significant effect on efficiency, and mixed utilities gain higher cost efficiency. Therefore, we may conclude that administrative reforms about privatisation and the institutional setting should consider a set of variables that characterise each individual organisation.


Pazzi, S., Tortosa-ausina, E., Duygun, M., & Zambelli, S. (2016). The cost efficiency of water utilities: when does public ownership matter?. Local Government Studies, 42(6),

Journal Article Type Article
Acceptance Date May 16, 2016
Publication Date Aug 19, 2016
Deposit Date Mar 16, 2017
Publicly Available Date Mar 16, 2017
Journal Local Government Studies
Print ISSN 0300-3930
Electronic ISSN 1743-9388
Publisher Routledge
Peer Reviewed Peer Reviewed
Volume 42
Issue 6
Keywords efficiency, geographical location, ownership, size, water utilities
Public URL
Publisher URL
Additional Information This is an Accepted Manuscript of an article published by Taylor & Francis in Local Government Studies on 19 Aug 2016, available online:


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