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Economic approach of the demand for drinking water. Case of the city of Cotonou

Yves Yao SOGLO student laureate

°1970 Benin
Master in business administration, Université Nationale du Bénin, 1997

Approche économique de la demande en eau potable: cas de la ville de Cotonou

In his thesis the author studies the supply of piped drinking water in Cotonou, the capital of the West African country Benin. He estimates the demand for water as a function of population size, family income, the price of water, and some other factors. In reality, the public utility in charge of supplying drinking water charges uniform tariffs that are highly subsidized in comparison to the cost of operations. There was, therefore, not much differentiated market information on what the public would be willing to pay as a maximum for water, in contrast with what it actually paid. The author therefore sampled some 150 households and questioned them about their preferences, in particular how much extra they would be willing to pay to continue receiving the continued supply of drinking water to their homes and dwellings. The ensuing data were combined with information regarding actual payment, income, household composition, and the like, to estimate a demand function. From the latter price and income elasticities were derived.

The study provides useful information about the likely evolution of demand through time, and the reaction of consumers to higher prices. The author makes a number of useful recommendations, among others, that water charges should be increased for those urban dwellers who can afford an individual connection, and that collective water collection points should be offered to the poor.

Yves Soglo's research has been carried out on an in-depth level, and it is particularly relevant. The somewhat paradoxal situation of Cotonou, where the public sector subsidizes water provision to the affluent and the middle classes, while it ignores de facto the needs of the poor, can be found in many other cities and countries. His study focuses on a widespread anomaly in public policy, and offers concrete solutions.

report by Prof. Dr. Robbrecht Renard, Institute of Development Policy and Management, Universiteit Antwerpen, Belgium