The Drivers and Impacts of Water Infrastructure Reliability
Inadequate infrastructure impedes the productivity of manufacturing firms, with negative consequences for the wider economy. This study examines how water infrastructure copes with severe weather fluctuations and analyzes the effect of unreliable water supplies on the productivity of manufacturing firms, focusing predominately on firms in developing economies. This is achieved using firm-level data from World Bank Enterprise Surveys covering more than 16,000 manufacturing firms in a cross-section of 103 countries between 2009 and 2015. The study finds that periods of significantly low rainfall lead to higher water outages, and that the overall impact is driven by the effects of drought on low-income and lower-middle-income economies, with upper-middle-income and high-income economies benefitting from more resilient water infrastructure. Furthermore, the study finds that incidents of water outages lead to lower firm productivity for firms in less developed economies. For the average firm located in a low-income or lower-middle-income economy, one additional water outage incident per day in a typical month can lead to losses of approximately 8.2 percent of annual sales. This finding calls for increased policy focus on water infrastructure services, particularly in poorer countries where water infrastructure and firms seem to be particularly vulnerable to the vagaries of rainfall.
| Main Authors: | , |
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| Format: | Working Paper biblioteca |
| Language: | English |
| Published: |
World Bank, Washington, DC
2018-11
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| Subjects: | INFRASTRUCTURE, WATER INFRASTRUCTURE, DROUGHT, FIRM PRODUCTIVITY, WEATHER, WATER SUPPLY, UTILITY PERFORMANCE, WATER OUTAGE, |
| Online Access: | http://documents.worldbank.org/curated/en/364371541098905355/The-Drivers-and-Impacts-of-Water-Infrastructure-Reliability-A-Global-Analysis-of-Manufacturing-Firms https://hdl.handle.net/10986/30843 |
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| Summary: | Inadequate infrastructure impedes the
productivity of manufacturing firms, with negative
consequences for the wider economy. This study examines how
water infrastructure copes with severe weather fluctuations
and analyzes the effect of unreliable water supplies on the
productivity of manufacturing firms, focusing predominately
on firms in developing economies. This is achieved using
firm-level data from World Bank Enterprise Surveys covering
more than 16,000 manufacturing firms in a cross-section of
103 countries between 2009 and 2015. The study finds that
periods of significantly low rainfall lead to higher water
outages, and that the overall impact is driven by the
effects of drought on low-income and lower-middle-income
economies, with upper-middle-income and high-income
economies benefitting from more resilient water
infrastructure. Furthermore, the study finds that incidents
of water outages lead to lower firm productivity for firms
in less developed economies. For the average firm located in
a low-income or lower-middle-income economy, one additional
water outage incident per day in a typical month can lead to
losses of approximately 8.2 percent of annual sales. This
finding calls for increased policy focus on water
infrastructure services, particularly in poorer countries
where water infrastructure and firms seem to be particularly
vulnerable to the vagaries of rainfall. |
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