Households’ Perceptions of “Reasonable” Water Bills in Ho Chi Minh City, Vietnam

A survey of 2075 households was conducted in Ho Chi Minh City, Vietnam in 2019 to estimate what respondents thought a “reasonable” monthly water bill would be for a randomly-assigned monthly quantity of water. Two different elicitation procedures were used to estimate respondents’ reasonable water bills. First, 830 respondents were asked two open-ended questions: (i) to state a water bill that they considered reasonable for the exogenously-assigned monthly quantity of water, and (ii) to state a reasonable water bill for their current water use. Second, 1245 respondents were asked a series of questions from a stochastic payment card (SPC). Four results are new and unexpected. First, respondents report some bills to be too low, suggesting perhaps that they realize suggesting perhaps that they realize that heavily subsidized water services and that heavily subsidized water services have unintended, negative consequences for consumers such as unreliable, poor quality service. Second, when asked about why they found a monthly water bill for specific quantity of water use “reasonable,” 25% of respondents said that one of the reasons was that “the bill is enough to cover the cost of provision,” suggesting that some respondents considered the costs to the supplier when deciding whether or not a monthly water bill for specific quantity of water use was reasonable. Third, respondents’ self-reported reasonable water bills suggest support for a positive fixed charge in the tariff structure. Fourth, many respondents’ interpretation of the term “reasonable water bill” does not seem to place too much emphasis on the affordability of the bill to poor households.