Consistency in performance rankings : the Peru water sector
Document Type
Journal article
Source Publication
Applied Economics
Publication Date
1-1-2008
Volume
40
Issue
6
First Page
793
Last Page
805
Abstract
Regulators can utilize a number of alternative methodologies for comparing firm efficiency, but these approaches need to be robust to be accepted by stakeholders. This study evaluates the consistency of water-utility performance rankings for Peruvian water utilities. The results indicate that data envelopment analysis (DEA) and stochastic frontier analysis (SFA) yield similar rankings in this case. In addition, the techniques have comparable success for identifying the best and worst performing utilities. However, these rankings based on sophisticated statistical techniques are not highly correlated with those developed by the Peruvian water regulator (SUNASS). This result does not invalidate the performance rankings obtained by the regulator, since those rankings are based on more dimensions of utility performance. However, they illustrate the importance of developing sound techniques for identifying weak utilities. Improvements in sector performance require that benchmarking be given greater attention than in the past.
DOI
10.1080/00036840600749409
Print ISSN
00036846
Publisher Statement
Access to external full text or publisher's version may require subscription.
Full-text Version
Publisher’s Version
Language
English
Recommended Citation
Berg, S., & Lin, C. (2008). Consistency in performance rankings: The Peru water sector. Applied Economics, 40(6), 793-805. doi: 10.1080/00036840600749409