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2007-12-21 | News

Exploring the determinants of the performance of rural water utilities in Costa Rica

This type of study in Costa Rica could be a key input into similar processes towards decentralization of natural resources management in the region.

There are more than 1,600 organizations that supply drinking water to local communities in the rural areas of Costa Rica. The performance of these organizations is quite varied; some of them are quite successful, while others provide low quality water and constantly interrupted services to their beneficiaries.

The EfD project led by Róger Madrigal and Francisco Alpízar discusses the factors affecting the performance of these organizations. Some of the hypotheses that explain the observed performance are related to: i) problems of moral hazard, ii) the effect of the definition of property rights on the incentive structure, iii) the density of network structures, and iv) the degree of downward accountability. A methodological approach to test these hypotheses will be based on the combination of comparative case studies and large data sample analysis.

The theoretical approach of this research is based on the Institutional Analysis and Development (IAD) framework developed by Elinor Ostrom and colleagues at the Workshop in Political Theory and Policy Analysis. Our research fellow Róger Madrigal spent last fall at Indiana University working closely with Elinor Ostrom in order to improve the theoretical approach and general research design of this project.

Local laws in Central American countries are transferring the responsibility of drinking water to local municipalities or other organizations. This type of study in Costa Rica could be a key input into similar processes towards decentralization of natural resources management in the region.