Estimating the Relative Efficiency of Brazilian Publicly and Privately Owned Water Utilities: A Stochastic Cost Frontier Approach 1

This paper assesses cost efficiencies of Brazilian public and private companies of water supply. To measure the efficiency, we used a stochastic frontier model derived from the translog family – a specification similar to a Cobb‐Douglas including a quadratic term in log output. The model parameters...

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Published inJournal of the American Water Resources Association Vol. 43; no. 5; pp. 1237 - 1244
Main Authors Da Silva e Souza, Geraldo, De Faria, Ricardo Coelho, Moreira, Tito Belchior S.
Format Journal Article
LanguageEnglish
Published 01.10.2007
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Summary:This paper assesses cost efficiencies of Brazilian public and private companies of water supply. To measure the efficiency, we used a stochastic frontier model derived from the translog family – a specification similar to a Cobb‐Douglas including a quadratic term in log output. The model parameters are estimated by maximum likelihood using Brazilian data for the year 2002. Statistical inference leads to the conclusion that there is no evidence that private firms and public firms are significantly different in terms of efficiency measurements.
ISSN:1093-474X
1752-1688
DOI:10.1111/j.1752-1688.2007.00106.x