When we go to the supermarket, our decision-making is considerably aided
by having the price, ingredients and source of goods clearly labeled.
This allows us to rapidly compare the characteristics, perceived
benefits, and price of different products to make what is usually an
informed and instantaneous purchase decision.
When it comes to making investment choices for public programs, we do
not traditionally have the same luxury of information. The full benefits
and costs of those interventions, including the long-term costs to
maintain and operate a service, are rarely understood or taken into
account in the decision. As a result, public decisions are usually made
based on the most visible costs (capital investment required from the
public budget), historical choices and the political process.
To reduce the detrimental effects of these influences, we need to move public sector decision making more
towards the supermarket model, and increase the availability of key
information so that decisions can be more rational, consistent, and
transparent.
Since 2007, the
Water and Sanitation Program (WSP), part of the World Bank’s
Water Global Practice, has been attempting to put a price on
sanitation by essentially understanding two sides of the same
coin:
what the costs of current inaction on sanitation are (i.e. how much
poor sanitation costs households and the wider economy) and how much
acting will cost (i.e. increasing access to sanitation services).
When it comes to acting, we need to understand the alternatives. What
technology option best suits the preferences and local practices,
available land, population density, disposable income, and willingness
to pay of different population groups? What are the benefits of
different technology options? And who is able to pay for the costs of
behavior change, capital investment and sustained service delivery?
In order to answer these questions, 47 field sites that had recently
implemented a sanitation program were selected across 6 Asian countries,
covering rural, urban and peri-urban areas. Both the costs and benefits
of sanitation were collected for these field sites, spanning across
available technology options. Country reports and briefings
from this work (Economics of Sanitation Initiative, Phase 2) have been
previously published. Among the many findings summarized in the newly released synthesis report, we found: Continue
