The impact of water and sewer privatization on tariffs and access in Brazil

Abstract

This paper aims to verify the impact of water and sewer services privatization on access and the tariffs charged for them. This paper is relevant mainly due to the sector’s recent legal changes that resulted in Law n. 14.026/2020 and the need to universalize sanitation services in Brazil. The differences-in-differences method was employed to estimate the impact, using data from 3.536 Brazilian municipalities extracted from SNIS, the Brazilian National Sanitation Information System, for the years 1998-2019. The results show private sector operators’ positive and statistically significant impact (compared to their public peers) on water and sewage services – including sewer treatment. Also, it detected a positive and statistically significant effect on the tariffs charged for those services once privatization occurs, compared to the prices charged by public sector operators.