Expanding economic perspectives for sustainability in urban water and sanitation

Abstract

The economic principles and tools that are commonly applied to recover costs for urban water and sanitation arise from the dominant perspective of neo-classical economics, with its emphasis on 'full cost pricing' based on the 'user pays' principle. Kumudini Abeysuriya, Cynthia Mitchell and Juliet Willetts examine two other qualitatively different economic perspectives to demonstrate how they lead to different approaches: ecological economics takes a more holistic approach explicitly committed to sustainability, while Buddhist economics brings ethics to the fore and opens the possibility for cooperation between the various actors in creating solutions to benefit individuals, society and the environment. We propose a set of interconnected guiding principles based on an expanded economic perspective that integrates all three perspectives, to enable water and sanitation services for developing countries to align with sustainability.