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Social Indicators Research
Published in: Social Indicators Research 1/2021

04-01-2021 | Original Research

Assessing the Quality of Service of Water Companies: a ‘Benefit of the Doubt’ Composite Indicator

Authors: Ramon Sala-Garrido, Manuel Mocholí-Arce, María Molinos-Senante

Published in: Social Indicators Research | Issue 1/2021

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Abstract

Evaluating the quality of service (QS) provided by water companies is essential to benchmark and regulate them. Composite indicators (CIs) are a useful tool for this as they consist of aggregated multiple performance indicators in a single index, providing a holistic assessment of the QS of water companies. In this study, the novel ‘benefit of doubt’ methodology was used in order to evaluate the QS of a sample of Chilean water companies, by computing CIs that integrate both direct and reverse indicators. Moreover, the estimation of the Nerlove–Luenberger super-efficiency CI allowed for the ranking of water companies based on their QS. Results showed that, on average, Chilean water companies provide water and sewerage services with high quality, as the mean CI of the QS estimated was 0.93. Nevertheless, the QS of 2 of the 24 water companies evaluated stood out remarkably. The second-stage analysis conducted revealed that the ownership and peak factor of water companies and water consumed by customers affects the QS of water companies. The methodological approach followed in this study to evaluate the QS of water companies would be very useful for water regulators, as the CI computed integrates both desirable and undesirable outputs.
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Footnotes
1
For a further description of the Chilean water industry, see Sect. 3.1 “Description of the Chilean water industry”.
 
2
Superintendencia de Servicios Sanitarios (SISS) is the Chilean national urban water regulator.
 
3
On 25th February 2020, the conversion rate was: 1 USD \(\approx \) 810 CLP; 1 € \(\approx \) 880 CLP.
 
4
An alternative set of initial indicators can be used depending the on the objectives of each empirical application.
 
5
To deal with the presence of outliers, the robust directional BoD model proposed by Vidoli et al. (2015) can be employed.
 
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Metadata
Title
Assessing the Quality of Service of Water Companies: a ‘Benefit of the Doubt’ Composite Indicator
Authors
Ramon Sala-Garrido
Manuel Mocholí-Arce
María Molinos-Senante
Publication date
04-01-2021
Publisher
Springer Netherlands
Published in
Social Indicators Research / Issue 1/2021
Print ISSN: 0303-8300
Electronic ISSN: 1573-0921
DOI
https://doi.org/10.1007/s11205-020-02588-1

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